What is the Creative Economy?

People are creative. It's what we do and it’s who we are. It’s also why we feel a sense of dehumanization when we’re forced to take on employment as a laborer rather than as the skilled craftsman or craftswoman we were born to be. Still, we find other forms of creative gratification when we’re off the clock: raising children, writing, and gardening are several common subliminations.

I was feeling pretty creative when I started a member-run consulting collective and started working with R3SET. I was a little less confident two years later in the partnership when I still didn't quite understand its focus upon what its cofounders always referred to as the “creative economy.” Finally, I figured something out; insofar as I understand it, the creative economy is like the green economy because it describes a less harmful way of making money. 

Scalechange's first get-together with R3SET in December, 2015

Scalechange's first get-together with R3SET in December, 2015

To add historical context, let's take a step back from postmodern economies. Modernity was a period of unrivalled optimism, a time when civilization's self-confidence got ahead of itself, which happened largely at the mechanical hands of scientific methodology. The twilight of modernity began with an inability to explain away quantum physics; thereafter, climate change was the hair that broke the camel’s back and started a depressing period of mass extinction.

Throughout modernity the optimistic zeitgeist told itself that we could derive value by monetizing the world’s natural resources: oil, labor, gold, etc. In order for this notion to function capitalism must expand continuously, constantly colonizing new sources of value until they’re completely exploited, and then moving on to the next resource. While we haven't quite run out these resources, we’ve calculated beyond a shadow of doubt that total devastation of everything we hold dear will follow if we continue to expand extractive industries.

They say necessity is the mother of invention. When it comes to human nature, serendipity is the rule rather than the exception. Just when the economy was running out of problems to solve, the biggest problem yet emerged from within: climate change. This reaction-formation is the epitome of “creative destruction.” In some kind of self-rationalizing loop, the purpose of creative capitalism to cure late capitalism, and impact investors know it.

Would you invest in Exxon or Google? In my eyes, the former is the quintessential old-world type of exploitive company that we need to get away from. A decade ago, at which point Exxon had already discovered and begun suppressing man-man climate change, it was the most valuable company in the world. What happened next demonstrates capitalism’s paradigm-shift into a creative economy. Google, the most valuable company today, launched a tech company that created value from data. Considering the catastrophic side-effects of Exxon’s operations, Google looks like an alchemist, sustainably adding billions to the economy where once there was no market: inventing value - magic?

If you're not feeling religious yet, let’s remember the dark ages preceding the world wide web: surely the manifestation of the internet, just when we needed it most, must cause you to wonder if there’s a larger force toying with us down here. To me, this new medium was the invisible hand’s grand finale, theatrically saving the world through its own destruction. Without the internet, the creative economy and the companies that it produced (like Google) would not have been possible.

But it’s always best to approach abstract matters in a down-to-earth fashion. Let’s take into consideration that Exxon’s Texan HQ is located in Irving, while Google’s Californian HQ is located in Mountain View. Historically, these two zip codes possess radically distinct cultures. They were both wild-west sanctuaries for cowboys and Native-Americans; thereafter, they quickly diverged. You might say that Google’s hometown drank the Koolaid. You can never underestimate the significance of a company’s community, and Google’s was once the grooviest of regions. It’s still pretty funky. It is no coincidence that from San Francisco to Berlin, WiFi hotspots emerged in hippie hotspots.

Progressives and futurists have long predicted the collapse of the traditional business’ commercial paradigm. It’s not easy but the most open-minded people are able to escape the limitations of our common predecessors. Occasionally, people like Steve Jobs create a whole new market, when they could merely posit a new product into an existing market. We all feel it. Many of us benefit from it. Miraculously, there’s an excess in value, rather than an Exxon. You can’t get something from nothing, but creative-economy come pretty close, benefiting all of us all the while.

I’m going to go so far as to claim that the only active ingredient differentiating creative-economy companies from “social enterprises” is that the latter add value to society more consciously. The best way I can describe the difference is recalling Facebook’s IPO, which was unique through and through, if you remember Zuckerberg’s infrequent visits to investors and his choice of a hoodie over a suit and tie. What stuck out most to me was the letter he attached to his offering, in which he claimed that Facebook was radically improving the world. Now, even Exxon could legitimately claim to have helped civilization, but it would have trouble making a case that it helped society more than it hurt the planet. Meanwhile, creative-economy companies Google and Facebook, would probably pass that test - they might even qualify as cleantech. Still, they’re not social-ventures because their founders weren’t social entrepreneurs who, like the founders of R3SET, set out to do social good as their primary mission.

At Scalechange we like socially-responsible companies a lot, but there’s a large VIP section in our hearts for companies that go a few steps ahead as creative-economy ventures and social enterprises do. Our origin story involves a Benefit Corporation that accelerates social-venture startups like ours. We came to Worldplay in order to find a way to fix industrial complexes: i.e., mass incarceration, endless war, climate change. With Worldplay’s help we developed our startup into a scaleable corporation, but we’ll always be grassroots activists, even if we have to put on a work blouse or wear a tie.

Our goal, in total alignment with the creative-economy, is to add value to society by harnessing the power of Web technology and the “crowd” it created, and to gamify sustainable, consciousness shopping, allowing consumers to live a much more intentional life than democracy has hitherto provided. We won’t be digging any oil wells. We won’t be opening any sweat-shops. Our value proposition is that we empower you to avoid companies that exact such a confounding social and/or environmental toll.