Simone van Bennekom and Ellen Loots  

Outputs (revenues, profits) and inputs (employees, investments) often define enterprises’ successes. However, as many entrepreneurs recognise: first, growth is often episodic and erratic, and, second, different dimensions of growth exist next to increasing sales and FTEs. The question now at hand is how enterprises can deal with diverging growth challenges. 

Tackling a double success criterion

Simone van Bennekom and Ellen Loots investigated how enterprises in cultural and creative industries manage to grow while experiencing tensions between creative and commercial demands. Creative industries are characterised by craftmanship, imagination, artistic quality, and innovativeness. They include the production of the arts (literature, music, performing, and visual arts) and activities such as film, media, television, radio, computer games, advertising, architecture, design, fashion, and museums. 

Typically, firms in creative industries deal with radical uncertainties regarding the perceived quality of their products: nobody knows whether a movie will be a blockbuster or an advertising campaign will be successful. The attention economy turns these industries into winner markets where firm growth is unpredictable and reserved for the happy few. How do the ‘winners’ in these markets explain their winning position? And what can be learned from their experiences?  

A dozen of interviews with market leaders in these industries, conducted by van Bennekom showed that entrepreneurs in creative industries need to understand the value creation and conversion processes in their industry to be able to survive or develop. In other words, in order to fit in, they need to understand the industry recipe. None are aversive to the commercial side of the business. 

Consumer, peer, and expert recognition 

In some cases, these entrepreneurs make sure to speak to consumers’ wishes. Alternatively, creative firms proactively seek approval from peers and experts, such as reviewers or professionals that make programme decisions, for example in music or museums. It is no secret that there are firms that invest in generating ‘buzz’ for their products, especially in B2C settings where the attention of many customers leads to economies of scale. 

Van Bennekom explains: “When possible, the entrepreneurs try to create this recognition and compete for rewards and awards, which can draw the attention of people. They apply different techniques to gain such ‘symbolic capital’.ii It is in the DNA of creative entrepreneurs, and other entrepreneurs can learn from these practices.” Fitting in is only a starting point. Standing out is another thing. 

Quality, impact, and revenues

Overall, entrepreneurs in creative industries see the creation of value rather in visionary terms than in monetary terms. A key finding of the research is that founders of large and successful creative firms in the Netherlands strive for quality, impact, and financial gain, and feel that firm development relates to all three. Van Bennekom:

“Revenues are necessary, but profit maximisation is not the aim of many creative firms. Only focusing on profit maximisation can hamper the innovative capacity of the firm.” 

Internationalisation and digitalisation activities have helped some entrepreneurs to create resource advantages vis a vis competitors. What works depends on both the industry and timing. Some advertising agencies in a B2B context provided digital services to their early-stage clients and were able to grow together with these clients. For an architecture firm, an international landmark project garnered attention and a growth leap. In the music industry, it was a matter of jumping on the digitalisation train to accommodate customers’ and clients’ changing needs.