Assets (Over/Shares #2)
Why do we still have starving artists? Assets.
I often ask artists what they believe their greatest asset is, and I inevitably get a similar set of answers:
“My creativity is my greatest asset,” says the musical theater writer.
“My ability to collaborate and see a project through to fruition is my greatest asset,” says the director.
“My greatest asset is my passion” says the actor.
I find these responses interesting. You see, in financial terms, an asset is “a resource with economic value that an individual, corporation, or country owns or controls with the expectation that it will provide a future benefit.” (Definition from Investopedia—love this website.) Generally, when people outside of the arts talk about their greatest assets, they’ll list such things as real estate, a stock portfolio, equity in a business, a valuable piece of jewelry, etc. Business owners will talk about their products, their strategies, and their shares as their greatest assets. To most of the world, an asset concretely means an item or an agreement that is likely to make money. For the financially inclined, assets are distinguished from liabilities, meaning, “things that you owe or have borrowed” and sit in neat little rows on spreadsheets to be examined and monitored by financial advisors who are there to take liabilities and turn them into assets.
I have been asking artists this question for six years now—“what is your greatest asset?”—and never once has an artist said to me, “My work is my greatest asset.” Now, before anyone comes for me with a theory about language shift and cultural differences, let me just say that I agree. I do think that artists are using the term “asset” in a more malleable, intangible manner than our brothers and sisters in other professional realms. But that does not change the fact that artists, for one reason or another, are not recognizing that they are responsible for creating highly valuable assets—assets that can create economic value.
Think about the score to a musical. One musical alone has the potential to be worth hundreds of millions of dollars and to stick around for generations of audiences to enjoy. Some of my favorite examples include Annie, the cartoon strip turned Broadway smash has been repackaged and redistributed over and over again, delighting new generations with new productions, film adaptations, and spin-offs. Or Phantom of the Opera, which only recently announced its closing after casually running for 35 years and grossing $1.3 billion from one production alone.
Film and TV are no different. I love the story of Titanic’s production, in which James Cameron sunk $200 million into the production only to come screaming back with box office revenues of $2.2 billion globally. Or the viral smash “Squid Game” which net $900 million in economic gain for Netflix after it took Hwang Dong-Hyuk 10 years to find a studio ready to bet on it.
I could also dive into music, dance, theater, etc. but suffice to say, the “work” that artists create can be extraordinary assets. So then the question becomes, why don’t artists immediately think of their work as their greatest asset?
Over this little series that I have put together, you are going to hear me talk a lot about ownership. In fact, I might end up sounding like a broken record. But the truth of the matter is that I have come to believe that the greatest impediment to an artist’s financial well-being these days is that there is not a meaningful way for us to own the assets we create.
Let’s take a look at the two fields I mention above—Film and TV and musical theater. It is industry standard for a screenplay writer to sell their screenplay to a studio for anywhere between $100-$500k. To us artists, that is an astonishing amount of money, but it is nothing in comparison to the millions (if not billions) that the same asset will create for the studio. Likewise, it is industry standard for a musical theater writer to license their musical to a producer who wants to mount a production around their asset. While the writer technically remains in control of the asset, they are literally at the mercy of finding a producing partner who wants to take a chance on their work. This often results in drafts of musicals sitting on hard drives for years before anyone ever looks at them. I have a number of brilliantly talented friends who have written brilliantly dynamic musicals that have never been produced.
In film and TV, artists end up owning 0% of the asset they’ve created that may go on to generate hundreds of millions; musical theater writers own 100% of an asset that is worthless without a producer.
In some ways this is an oversimplification of two branches of our industry but the foundational truth is that there is not a generalized practice for artists to be able to own and grow their assets in any meaningful way. We don’t have that type of control over our work. And this is a reality that many artists have realized over the years. The major players — Netflix, Spotify, Disney, Broadway League, etc.— either own artists work outright or control the ability that artists have to produce and distribute their work to large audiences.
What is fascinating is that this is creating a problematic culture for the major distributors who are struggling to keep up with the demand for content. Netflix has recently been described as “overwrought” and “overstuffed,” after it lost a million subscribers this past year. Broadway has posted consistent box-office losses while production costs continue to rise. And Disney’s most cutting edge innovation these days is to repackage content from the last 25 years in a hope that the same audience will once again enjoy it.
Distributors and studios need artists to be doing their best work in order to survive. That said, they have also gotten used to outright owning and controlling the very assets that we create. From a financial perspective, the only way to rectify this is to create a systemic shift in which artists regain control over their assets and work with distributors to get their work out into the world.
I will stop here for today because I could go on and on with this subject. And don’t worry, in the coming weeks I will explore topics including how the nonprofit model handles assets, how equity is handled when growing traditional projects, and how ownership could work for artists.
But what do you think? Do you think of your work as an asset? What are your experiences with trying to get your work out into the world? What are some of the ways your assets have created an economic return for you?
Happy Monday, y’all!
P.S. If this article was of interest to you, Midnight Oil Collective has teamed up with Tsai Center for Innovative Thinking at Yale and is hosting a FREE 6-session workshop this fall on how to starting thinking about your work as a highly profitable asset. Come join us for this powerful conversation in which we reimagine the world as one in which artists were in control of their art!
