Museums, startups and accelerators… oh, my!
Brendan Ciecko is the CEO and founding father of Cuseum.
Startup accelerators have grow to be an integral a part of serving to early-stage firms construct, fund and convey to market new merchandise and concepts. Numerous startups wielding unicorn-status valuations can credit score their fast progress and success to packages like Techstars, Y Combinator and different seed accelerators. These packages run early-stage groups by way of a three-month bootcamp, infusing them with capital, house, assets and skilled mentors to push them to “do extra quicker” and “make one thing folks need.”
Lately, we’ve come to see museums, such because the New Museum, ACMI, and Te Papa, look to the fashions of accelerators, incubators and coworking areas to carry collectively entrepreneurs, hackers and cultural practitioners in hopes of driving innovation and producing new concepts.
Whereas nonetheless within the early days, the query stands: Is that this an experiment, a fad or a brand new pattern?
Who’s doing it?
In 2014, the New Museum in New York Metropolis opened its doorways to NEW INC. Dubbed “the primary museum-led incubator,”* this coworking house is dwelling to greater than 100 tenants within the areas of artwork, design and inventive expertise. Underneath the revolutionary management of Lisa Phillips and Karen Wong, and with $2 million in funding, New Museum was the primary museum to carry an experimental coworking side to their establishment. Members apply, pay for membership and have entry to a neighborhood of like-minded friends.
In an official assertion, the museum emphasised that “the incubator is the most recent in a sequence of packages developed by the establishment to problem the boundaries and develop the relevance of museum observe within the twenty-first century, foster artistic cultural manufacturing, and reinforce the Bowery as a spot of significant innovation.”
NEW INC’s advisory council consists of heavy-hitters like John Maeda, Neri Oxman, IDEO’s Fred Mud, Kickstarter’s Yancey Strickler and USV‘s Andrew Weissman. Artwork/tech rock star Julia Kaganskiy runs the operation and continues to develop its partnerships and influence. Whereas many of the residents are artists and businesses, startups reminiscent of NewHive, Monegraph, SIREN and Niio have known as NEW INC dwelling through the years — and have collectively raised hundreds of thousands in seed funding.
That very same yr, Minneapolis Institute of Arts, one of many largest artwork museums in america, began to experiment with the idea of coworking with its pilot of Hothouse. The museum even had an “Entrepreneur in Residence” program! Though each packages appear to have light away, the museum has a “Enterprise Innovation Director” — a first-of-its-kind function, and one which lives on the management workforce.
In 2016, Australian Centre for the Shifting Picture launched acmi X to carry collectively Melbourne’s creatives and encourage collaboration between tenants and museum workers. And Modern Arts Middle, New Orleans lately introduced plans to launch a coworking house known as The Store.
Now, right here comes the accelerator
In 2016, Te Papa, the nationwide museum of New Zealand, launched Mahuki to speed up native startups centered on the cultural sector. From the 34 functions, 10 firms had been chosen to participate within the museum world’s first-ever accelerator program. One of many museum’s targets is that these batches of artistic groups might assist Te Papa tackle and resolve a few of their challenges. Every firm acquired NZ$20,000, in addition to entry to the museum’s specialists, collections and guests in alternate for a 6 p.c fairness stake.
“Te Papa has at all times been a artistic powerhouse, and dealing with these thrilling firms will carry new concepts into the combination. We have now carried out our homework and we all know there’s a must assist improvements for the cultural sector, each globally and regionally,” proclaimed the museum’s CEO, Rick Ellis in his statements across the launching the accelerator.
Past the coworking mannequin, museums investing in startups could be very new and very experimental.
Why it’s compelling
Slightly than spending funds on home-brewed one-off initiatives that may by no means grow to be sustainable or hit essential mass, this idea places cash into the fingers of uber-lean firms or teams of builders who will construct at a steep low cost, unbiased of conventional museum tempo, course of and protocol.
It may very well be attention-grabbing for museums to spend money on firms that assist resolve a singular drawback they face, with a monetary stake within the answer being shared and supported globally.
There are apparent synergies between museums and tech firms like Artsy, Cuseum, Electrical Objects and Estimote. These startups all have some degree of alignment and have already got deep partnerships with artwork museums. A museum that invested in Artsy would seemingly be ecstatic to see an art-focused firm that went on to lift greater than $50 million and grow to be a market chief. And, with tons of of museums across the globe utilizing from Y Combinator-based Estimote, is the thought of taking part of their subsequent spherical of funding that far-fetched?
Universities and foundations are already investing in startups; it’s not that radical of an idea. Dozens of universities, together with Stanford, MIT, NYU, Purdue and College of California, have all elected to take a position their endowments in early-stage firms.
Stanford has been investing for greater than a decade, and their portfolio consists of SeatGeek, Zipline and greater than 50 others. NYU’s Innovation Enterprise Fund, a $20 million fund based in 2010, has put cash into Clarifai, numberFire and Framed Information. Foundations just like the Gates, Ford, Knight and Thiel foundations actively spend money on startups, as nicely.
That is one more means that museums can diversify their endowment investments, lots of that are already invested throughout shares, mutual funds, hedge funds, personal fairness and actual property — however with extra pores and skin within the new sport.
Proceed with warning
None of that is core to the museum’s mission. Straying too removed from the fundamentals, conceptually and financially, can have a unfavourable influence.
In 2009, The J. Paul Getty Belief, the world’s wealthiest arts establishment, took a big hit. The worth of their endowment declined greater than 25 p.c in a single yr. Their “various investments,” together with that of enterprise capital, confronted criticism and administration shake-ups; layoffs and funds cuts ensued.
Simply take a look at the current actions of the Metropolitan Museum of Artwork, the biggest museum in america. Over the previous few years, the museum considerably expanded their workers and overexerted itself in quite a lot of areas, together with rising expertise. “Digital investments” had been one of many areas going through scrutiny; this summer season, The Met abruptly slammed on the breaks within the face of an estimated $10 million deficit.
Museums don’t historically have a lot entry to early-stage funding experience. Until led by skilled startup buyers, what’s already dangerous turns into even riskier. With some asserting that an estimated 90 p.c of startups fail, that’s a troublesome tablet to swallow. To magnify the purpose, now think about the flavour of an funding going into an organization like Theranos — ouch! Regardless of the hype and attract of enterprise investing, it’s been extensively reported that almost all of VCs underperform the market.
There are many firms already addressing the wants of museums, and the general draw back may be an excessive amount of for many establishments to bear.
Museums ought to lead in schooling however not in funding rounds, proper?
There are numerous seed funds that don’t “lead” investments in early-stage firms. If Knight Enterprise Fund, a centered $10 million funding car below the Knight Basis, which has a devoted supervisor and advisors like Joi Ito and Fb-founder Chris Hughes, is never the “first cash in,” why ought to museums be?
A $20,000 funding from a museum may very well be higher suited because the final $20,000 in a $1 million spherical, however even higher suited to later-stage progress rounds. There are numerous buyers that gained’t spend money on firms except that firm has already raised greater than $500,000 and even $1 million — it at all times takes far more than a founding workforce estimates to construct, market and promote their product. Why tackle the chance?
If a museum is decided to spend money on startups, for the sake of monetary returns, it might spend money on an current seed fund managed by specialists with a observe document and the assets to help the corporate in its progress, or co-invest alongside them. If the establishment’s funding curiosity is pushed solely for the sake of fixing an issue, it could be best to spend money on firms that already secured important funding and have proven notable traction and market validation.
My tackle the subject
As a startup founder who’s deeply enthusiastic about museums and the humanities, naturally, I’m intrigued by this motion. I’m an advocate for something that promotes development, experimentation and digital evolution within the cultural sector. Stronger partnerships between startups and museums, and cause-based organizations, would have nice influence. The thought of museums investing in startups represents a paradigm shift — good or unhealthy stays to be seen.
On the much less radical aspect of the spectrum, I feel what the New Museum and others are doing round coworking is a gorgeous approach to capitalize on a couple of of their “property” (house, location, inspirational worth) and foster a artistic “hub” to share mutual advantages. Past the brand new stream of income, museum workers have entry to innovators they’d in any other case be siloed off from, and the innovators have a artistic setting to feed off. It goes with out saying, Richard Florida could be proud. Museum-led coworking areas promote collaboration and various considering, and showcase a brand new sort of worth I’d wish to see extra museums train and take credit score for: “industrial” worth to the skin world.
Maintain your eyes on the brand new methods cultural establishments wish to spur innovation, forge partnerships and create further income streams, all whereas highlighting their function as hubs for artistic exploration into the 21st century.