Social Enterprise Models for
Digital and Data in Culture
By Patrick Towell, CEO / April 2023
The Power of Data
We are at an inflection point in human society where the control of data determines who has power. Whilst it may have always been the case in theory, the scale of the data – and the computing power and intelligence that can be applied to it – is unprecedented.
This is one of the reasons I’m so excited to have launched TAA Tech Ventures and Audience Finder Global which exist to put the power of advanced analytics in the hands of creative and cultural entrepreneurs worldwide to enable them to innovate and compete. For compete they must – as the attention of their audiences and the increasingly large proportion of the public that never engage with ‘culture’ is grabbed by social media, gaming and streaming, all of which are heavily data-driven.
Linked Missions
Our mission to enable the cultural and wider experience economy to grow inclusively through automated market intelligence and customer insight is not far off the mission I set myself when I left university having studied Maths and Computing; to use technology to improve the quality of people’s lives. It’s also linked to the mission of the innovation consultancy I founded which I merged with TAA Tech Ventures back in 2018: to use digital innovation to enable people to understand more about themselves, other people and the world.
A Commercial Perspective
The digital and cultural sectors co-exist in a creatively inspiring but occasionally uneasy way. Digital is a class of technology; humankind applies technologies to drive innovation; innovation requires capital; capital requires entrepreneurial financing and business models. This is uncomfortable territory for the public and non-profit sector people in the cultural sector, who can perceive this as neo-liberal. It also doesn’t sit well with the visionary creatives who don’t like to think of their work as assets that are commercially exploited.
But what can we do? Not thinking about money – and making profit – has terrible consequences. Artists and other creatives have to eat and pay rent. People working in the cultural sector are increasingly underpaid in relation to equivalently skilled jobs in other sectors. Consequently, the sector excludes those who don’t have the luxury of choosing to depress their salaries to work in it. Not only is it increasingly difficult to attract and retain talent with cutting edge digital and data skills – the diversity of background and lived experience of those that do work for you suffers.
Another consequence of not making a profit is the inability to self-finance digital innovation. Making a profit is the only way to generate reserves. Without reserves cultural leaders cannot choose which innovations they think their organisation should – and wider sector could – invest in without having to persuade a grant funder they are right. Without the promise of future profits, you cannot raise most kinds of other finance. The legal and governance structures of most cultural organisations actively prevent them raising the kind of finance that significant digital – including data – innovations require.
Impact Investing
There is a tendency for public funders and commissioners of digital services and content to want to own all the IP in them and prevent any parallel exploitation of them. Sadly, this too is a death knell to any hope of a self-sustaining business model once the political priorities have moved on and there is no longer public money to fund it. As a consequence, most digital services in the cultural sector have what we might dub a ‘hope-based’ funding strategy.
Thankfully, help is at hand. The UK ploughs a peculiarly hybrid furrow when it comes to business. It’s the birthplace of ‘social enterprise’, a concept that brings together entrepreneurship and enterprise models with social and environmental purpose. The UK is also Europe’s leading hub for ‘impact investing’, which mixes financing models from the venture and corporate worlds with the achievement of social and environmental goals. In 2023 this hybridity is embedded in social enterprise and ESG (Environmental, Social, Governance) investment practices all over the world.
When applying to the Alpha Startup Programme of Web Summit Rio, it was wonderful to see that, as well as uploading your pitch deck, you had to tick exactly which of the UN’s Sustainable Development Goals your enterprise was going to help deliver.
Treading a Careful Path
So, we tread a careful path. Ethical use of technology and data isn’t just an add-on, it’s fundamental to nurturing the trust required to operate our model of aggregating cultural engagement behaviour data. Ensuring the data we collect is used to the benefit of the public and the cultural sector is burnt into everything we do. Being independent of all the commercial digital platforms that sell tickets and optimise marketing – but at the same time being in relationships with them all – is essential to us providing a ‘whole market’ view.
I’ve spent so much of my career being almost the only private sector person in the room and yet entrusted by government, public bodies or non-profits to deliver what they need, I have to remind myself it’s an unusual and privileged position. Similarly, running a company founded by a charity, I’ve discovered, is an unusual gig – there aren’t many of us! Generating profits to help us secure the resources to achieve our mission is for me an exciting prospect.
Patrick Towell, CEO of TAA Tech Ventures