The price of creativity

0:00This message comes from IXL, providing an online learning environment intended to keep student skills sharp over summer vacation. The platform covers core subjects and adapts to each child's pace. Receive 20 % off at IXL.com slash NPR. This is the TED Radio Hour. Each week, groundbreaking TED Talks. Our job now is to dream big. Delivered at TED conferences. To bring about the future we want to see. Around the world. To understand who we are. From those talks, we bring you speakers and ideas that will surprise you. You just don't know what you're going to find. Challenge you. We truly have to ask ourselves, like, why is it noteworthy?

0:41And even change you. I literally feel like I'm a different person. Yes. Do you feel that way? Ideas worth spreading. From TED and NPR, I'm Manoush Zomorodi. It feels like everywhere you look, people are making and crafting and writing and taking photos to share online. Today is my official three-year anniversary as a content creator. So I make my own clothes. I love this dress. I'm building a tiny home for my sister. But where is all this creativity coming from? A word like creativity feels eternal, as natural as air. It's like the base level of all of life. This is entrepreneur, musician, and writer Yancey Strickler.

1:31He's a sort of creativity history buff. Well, a common mistake we all make is assuming that the world around us has always been this way. And this is even the case when it comes to ideas that are as bedrock as art and creativity. But in the 1940s, the U.S. government started taking these fields very seriously. And in part from Department of Defense research and funding. Post-World War II, people were worried about American society becoming too homogenous. And the U.S. was worried about facing off against the Soviet Union. And so they needed individuality to contend with this totalitarian society.

2:17The things about us are made to express our own free spirits and desires. So the Defense Department and some social scientists began to study this question of what to do about it. What do we do about this issue of conformity? On come the developments of ideas in pace with the emphatic decisions of the American people as to what they want. This is when there were more white-collar workers than blue-collar workers for the first time. And they ended up proposing a concept of something called creativity, which they discovered after studying artists and engineers, in particular engineers who pulled all-nighters, and they wanted to understand what made them work, what motivated them.

3:01Yancey Strickler:To do that, they gave them everything from Warshaw tests to the Myers-Briggs personality test. And they found that these people had this internal drive to make things better. They're just driven in that way. So they began to theorize that what if they could teach people to develop the same skill? They could teach people this notion of creativity. Then creativity would be this democratic form of genius that anyone could access. From there, the push for creative thinking took off. A 1958 bill promoted science and technology education specifically to get kids to think differently in the name of national defense.

3:43In the 60s, creative writing began to enter American schools, brainstorming, open-ended thinking practices. And these were intentionally created as a way to teach children how to be creative. Developing creativity was seen as a strategic goal of America. That has continued ever since, to where someone like me, I think of myself as a second-generation creative American, where I went to public schools, where I was taught all of these things. And creativity is very much a deep part of my life. Much of this history is chronicled in the 2023 book, The Cult of Creativity by Samuel L. Franklin. It was very strange to think that there was this origin to creativity, that it had this military industrial purpose that was made to make people more productive and to make things that were more impactful.

4:36but the more I sat with it the more I actually think it's beautiful that this is something that originated through a social scientist that people had the sensitivity to ask and to study how other people stayed connected and loved what they did to ask what makes those distinct voices distinct how could we have more of them how could we teach that in this phrase of a democratic form of genius And so when I look at the world now where more kids want to be creators than anything else, where creative expression and culture are at the center of really everything in America, it's like how politics works, how the economy works, how everything works.

5:18What I see is not some momentary blip, but I see the payoffs of investments that were made 70 years ago. We are on a continued climb in this long process of America embracing creative culture as one of its founding core ideals and one of the things that really makes America distinct. Can you say E.T.? E.T. Run, Forrest, run! And so when I look at the 21st century and I think, what are the dominant forces that are shaping the world around us now? It's the Internet. It's AI. And it is also creativity. I'm about to hit a million followers on Instagram, which is absolutely nuts. Finishing off my first draft probably in the next two weeks.

6:10Posting my original song, so maybe I can do this instead of going to college. Free to problem solving, cultural solutions, design-oriented answers, thinking, all of that. This is a long-term investment made by the state, made by past generations that has worked its way through and has now produced just an absolute explosion of output and production. I use this 1960s sewing patent. Welcome back to my monthly Breakfast Club series.

6:38Yancey Strickler:Only neither book cloth or a substitute like leather. I frequently use this one. But even though Americans are consuming more creative content than ever, you believe the economics are not keeping up. It's not all wild ideas and roses. There's a big problem. That's right. You know, right now we find ourselves more people than ever creating, more demand for content than ever, yet less support systems than ever. And there's this very acute pressure that every artist and creative person feels right now of like, I feel like I'm falling behind. I don't even know what to do. You know, and what is this world that seems like it's sort of racing away from me?

7:23In an era when anyone with a phone can call themselves a creator, and half of all young people say they hope to become an influencer, how are they turning all this output into a paycheck? And what does all this commoditized creativity mean for art, money, and culture? Well, over the next two episodes, we're digging in. First, Kickstarter co-founder Yancey Strickler explains why capitalism needs to transition to accommodate this new marketplace. And then next week, Gen Z linguist and TikTok creator Adam Aleksic shows us how algorithms are reshaping language, attention, and what we value. Together, they'll help us understand the creator economy.

8:09Let's get back to Yancey. In the early 2000s, he was living in New York, working as a music critic and running a tiny record label, when he met a guy named Perry Chen. Like me, he was a creative person, always trying to get projects off the ground. And he had wanted to throw a concert, but didn't have the money to do it. And thought, what if he could just propose the idea for the concert online? People could pre-purchase tickets, and the show would only happen if it sold out. and if there was enough interest no big deal he wouldn't be out the money and the people together could decide and this idea really resonated with me because at the time as a creative person to get support for your projects you had to go pitch like a proper company of some kind or some board of approval that you needed there wasn't that direct path where you could just go out into the world with your own ideas.

9:05And the idea of letting us as fans have a voice in what we wanted to see, and the idea that we as artists and creative people wouldn't need to ask for one person's permission, but instead convince people of the merit of our vision, that just seemed way more fun and more interesting. It ended up taking them, plus a third co-founder, years to create a platform that could let people crowdfund their projects. They called their site Kickstarter. In 2009, Kickstarter went live, and the very first week, a project was successfully funded. And it wasn't an overnight success, but amazingly for us, from the moment the site was there, people got it.

9:50People understood what it was there for. They saw it as a type of a game. It had an energy. Like everything we could have dreamed really happened. And for creative people, it just dramatically opened the doors to where no longer were we all lining up in front of these singular gatekeepers. But instead, we really had the freedom to go out the way we wanted with our own projects and ideas. And it has just opened the floodgates to now, you know, a much bigger world that we call the creator economy and a whole bunch of other stuff. That project was really one of the first that showed what the internet could do, that really put a lot of trust and a lot of power in the hands of individuals versus the institutions, and exceeded all of our expectations, but really came from our own experiences as creative people ourselves.

10:46Musicians got their albums funded by groups of friends. Authors crowdfunded their new novels. Even huge companies like Peloton and Allbirds got their start on Kickstarter. At this point, I think it's$9 billion or something like that that's changed hands through the platform. In 2017, Yancey stepped down as CEO. And I returned to being a full-time writer, author. I wrote a book and was leading a community and was doing everything I thought I wanted and had thousands of people gathered around ideas I was really passionate about.

11:20Yancey Strickler:But he struggled to figure out how to make this group of creative people who were making books and all kinds of other creative products financially viable. He didn't want to start a nonprofit or another big company. I didn't want to be at the top of a pyramid. I wanted to be a part of something with other people. And I really struggled to see how to do that. How do I as a creative person have peers? Um, you know, do I have to start a band? Is it like a collective, but a collective seems scary. Collective seems like I'm supposed to give up my identity. Like I don't, I don't want to do that. And so I ended up thinking about the model of an indie record label where, you know, a way a label can sort of represent a scene or a sound or a place, and it can bring a lot of different people together around that.

12:08And what's cool about a label is like by being a part of a label, you're not giving up your individual voice, but you are just benefiting by being a part of something larger than you. So I started thinking, could you reimagine something like that, not around music, but around any sort of creative form, where people who had a common purpose or common taste, people who wanted mutual support, they can have a structure that let them do that and let them easily share money, share audiences, and just not be trapped on their own. In a minute, more about the answer that Yancey came up with and how he thinks it could be the way to give creative people the power and money they deserve.

12:52In a world where 48 percent of Americans report having a personal creative practice, in a world where art and culture has gone from sideline to like main stage, it just creates a very different set of conditions. Today on the show, part one of The Creator Economy. I'm Manoush Zomorodi, and you're listening to NPR's TED Radio Hour. We'll be right back.

13:27This message comes from Grainger. For the ones who get it done, Grainger offers the professional-grade products you need to get the job done. with fast delivery and access to technical product experts ready to help you meet any challenge. Call, click Grainger.com, or just stop by. Support for NPR and the following message come from Rippling. These days, you can chat with AI about almost any business problem, but Rippling AI is designed to actually solve them. That's because Rippling AI is built on your live global workforce data, so it doesn't just uncover insights into your business, It uses them to take complex actions across your departments.

14:08Ready for AI that isn't all talk? Head to rippling.ai slash NPR and get AI that turns insight into action. That's R-I-P-P-L-I-N-G dot A-I slash NPR. Sign up today. Support for this podcast and the following message come from ActiveCampaign, the autonomous marketing platform. You know that feeling when you open your marketing tool and instead of marketing, you spend an hour wrestling with a drag-and-drop builder? ActiveCampaign built active intelligence for exactly that moment. Describe what you want to accomplish. It builds the campaign, writes the copy, and maps the automations across email, SMS, and WhatsApp.

14:50Customers save an average of 10 hours per week and make email campaigns eight times faster. Learn more at ActiveCampaign.com.

15:27www.travelnevada.com. It's the TED Radio Hour from NPR. I'm Manoush Zomorodi. On the show today, the creator economy with writer and entrepreneur Yancey Strickler. So earlier, Yancey explained the origins of how we think of creativity today and why more and more people are trying to turn their creative pursuits into a source of income. I'm creating a super cool piece of like brutalist inspired wall art. From artists and musicians. I wrote a song and I'm posting it. To chefs. Here's everything I made for an eight person birthday. To fashion influencers.

16:07Yancey Strickler:Let me teach you how to style what you already have. At the beginning of every week. Social media has turned creative expression into a whole new industry. Here's how I made about$7 ,000 going live on TikTok for one month. We talked to one content creator named Shivani Shah. She's a professional dancer who started posting videos during the pandemic. I never really imagined it kind of from the lens of, oh, I'm creating content. It was just, oh, I'm doing this thing that, you know, I'm stuck at home in COVID. I'm bored. I'm just going to do this thing and post it. But her videos caught people's attention.

16:43So she started collaborating with other dancers online. It was just crazy because I was like, wow, all these people like really love what I'm doing. want to do it too. And Shivani started to make money from the platforms and advertising. She built a brand with another dancer. They posted routines together, had in-person classes, even went on tour. Hi everyone, we are They Seafuse. I'm Shivani and this is Ishani. And we both started shuffling in the summer of 2020. Now to keep the money coming in,

17:13Yancey Strickler:Shivani has to keep posting and posting. Yeah, I mean, when you start pursuing your creative hobby full-time. Sometimes you have to do work that you're not that excited by just to get, like, the paycheck from it. And other times, the work you really want to pour into that may require more time and creativity isn't the work that's also paying you. Today, Shivani goes back and forth between full-time content creation and working in the corporate world so that she can have health insurance. It's a tenuous mix because it's not Not easy out there. As of 2023, only 4 % of content creators made more than$100 ,000 per year, according to Goldman Sachs.

17:58Most of those earnings come from brand deals or pitching products. Other revenue comes from subscriptions or donations. But the creator economy is projected to grow to a$480 billion industry in the next few years. and Yancey Strickler believes it should just be easier for more people to take part in it. The act of people going online, expressing their talent, their hobby, their passion, doing so in a way for which they are directly paid by their audience, or in a TikTok era that they're paid by a brand to endorse a product, or maybe they have a product they're selling in the Instagram or TikTok store as a part of what they do.

18:43that that overall space, that direct connection between a personality and an audience is going to be a hugely significant area of the economy.

18:53Yancey Strickler:But that doesn't mean that every person who considers themselves an artist or a creator should be paid for their work, does it? I mean, if someone aspires to be, I don't take that away from them. In our survey data, we find that about half of people have some sort of legal formation. So to me, that says half of these 3 ,000 plus people take it at least fairly seriously, serious enough that they were willing to spend$500 to do some paperwork, some arduous paperwork about it. So say half of people are doing that. And say the other half, yeah, maybe half would love that opportunity. Maybe the other half, they don't need it.

19:34It's more about singing at church or writing their newsletter, and it's just for fun. It's just for fun. But for the kids coming up, for however many young people who want to be creators, or the fact that New York City's art schools have the highest application rates ever this past year, there's more energy going into this place. And so I think there is an expectation, a hope that it will bring probably greater economic benefits than is realistic. But in the future, I think that that might actually be the case.

20:10Yancey Strickler:But I guess what's different now is that we see it as a potential profession, whereas we used to call that hobbies, right? Is that what's changing in terms of this idea that I love doing this and guess what? Maybe I can get paid for it too. Absolutely. The internet has made it so that we can turn our side hustles into forms of income. We can turn them into jobs. The challenge is that the act of being an artist in a world like this is not as simple as it used to be because now you have many jobs. You're the artist, you're the marketer, you're the community manager, you're the order fulfiller, you're all of these things because we're ultimately running these small businesses around our hobbies.

20:59And this is where you see a lot of stats about burnout being something that's quite common, even for people who are very successful at this. Because it is very much a grind. It's an always-on grind. And there's not a lot of peer relationship that's a part of it. and you know i i i'm the optimist who believes that these conditions can change i believe that what's happening now is not a fad it's not going away that creative work is undervalued in our eyes it's more valuable than people realize and that a world in which creative people are reliant on these other players to support ourselves like we're always we're always going to be vulnerable.

21:40And so we really need a system of our own. And that brings us to Yancey's big idea. He's working on creating a new legal structure to offer artists protection and stability. He calls it an artist corporation or A Corp. That's right. Yeah. And an artist corporation or an A Corp is a proposal for a new legal type, a new corporate type that would be established through a new law, a law established at the state level. And the goal of an artist corporation would be to make a entity that represents creative businesses. Right now, most of those businesses opt to be either an LLC or S-Corp. LLC is the most basic legal structure.

22:26It's a legal shield over the project, gives you some tax benefits. It doesn't have upside, doesn't have easy ownership sharing exactly, but it's sort the base level most people use. It's also not the friendliest to use. But what an A-Corp does, A-Corp is designed from the ground up for artists and creative people. So to qualify for an A-Corp, you have to be making a creative output of some type. The project must be at least 51 % owned and controlled by artists and creators, not outside investors. So you're pre-qualifying in. And as an A, you can raise money from both for-profit sources as well as receive non-profit sources of funds.

23:07But overall, we're trying to create a structure that validates creative work and that lets creative people participate in capitalism, have entities, be a real player the way that other economic players are in our culture today. And we think the A Corp does that. The A Corp just might be the door that opens up a new path to prosperity for creative people. Here's Yancey Strickler on the TED stage. You could think of an A Corp as like a company, but built for how creative people work. And we can imagine a band starts, and right from the beginning, they have an A Corp. So they're not just five individuals, they're people who collectively own an organization that has the power to own their intellectual property, their gear, their business.

23:53As they start to get paid, that money can automatically flow to each of the members according to pre-set amounts, and they could even set aside money to be saved for future projects in a treasury or pooling together with other artist corporations to get better health care or other benefits. As an artist corporation, they would also be able to receive both commercial revenue as well as non-profit sources of funding. And if a label or a bigger commercial entity came along, rather than just selling the rights to their intellectual property, which has been customary until now, as an artist corporation, they can issue shares.

24:25So instead, that entity would make an investment in the artist corporation, allowing it to be valued more highly and everyone to benefit if things went well. The music industry is a particularly interesting example because it used to be the case that a popular band could make a lot of money from selling records. But then, of course, the Internet came along.

24:47Yancey Strickler:And now with streaming platforms, it is much harder for artists to make as much money, any money. So the old system no longer works, but we haven't figured out a new one. We're definitely in the bardo. You know, we there is a system that drove the 20th century of creative production that is still in power because it holds the ownership rights to all of that work. But definitely it's it's it's tools are less relevant today than than they've been in the past. um you know what's interesting is that say in music music is a great case if a band gets signed traditionally you know they they're given a standard record deal which in all likelihood leaves the label owning the publishing and masters of their work you know they get some cut of it they get a royalty they start some llc with evidence from their manager and maybe that's set up by someone else and they end up not owning their actual work.

25:50They're getting paid out after all these deductions that they don't understand. And they're, they're a part of a system where they have no agency whatsoever. And it's wild. Like for the capital sources of culture today for labels and, you know, studios, these bigger entities, artists are essentially service providers who create assets that these larger entities acquire and capitalize on. We're in a weird spot in the industry where it's capitalism for me, but not for thee, not for the artist.

26:25Yancey Strickler:So how would it work if a band created an A-corp, how would the money get back to them should they have some success? Well, so as an A-corp, they could pre-register to say, okay, listen, our A owns the IP of music that we create. And so if a label wants to work with us, great. Well, they can negotiate with us either an investment for which they get the right to distribute this work, or right now, labels are dealing with individual artists who know that this is their only chance to make it, and they're probably going to sign anything in front of them. But if you look at the way these same entities, these corporations, interact with peer corporations, what do they do?

27:11They make joint ventures. They make things where both parties share in the upside together. So in a world where the band has an A Corp, I think their record would be like a joint venture co-owned by the band and the label at which they are both putting in some money or labor to make it happen and which they both own in the upside. It's not one where only the corporate entity, the larger corporate entity owns the upside and the artist just gets basically excess returns. But instead it's one of like real partnership and real ownership.