Skip to content

Investing in the Creative Economy for Good and Profit

Category: Center for the Future Of Museums Blog
Laura Callanan speaking at the Smithsonian Institution's Power of Giving 2018 symposium on Impact Investing through a Creativity Lens.
Laura Callanan speaking at the Smithsonian Institution's Power of Giving 2018 symposium on Impact Investing through a Creativity Lens.

When it comes to managing their endowments, museums typically focus solely on financial return. This is a missed opportunity to advance their mission-related work. Some avoid investing in sectors (tobacco, extractive energy) at odds with their mission, but few museums actively wield their investments to advance their mission-related work. (As I pointed out in a recent post, the cumulative value of just nine of the largest endowments in US museums is ~$7.7 billion. Not a shabby sum to invest in social change.) Today on the blog, Laura Callanan, founding partner of Upstart Co-Lab and former senior deputy chair of the National Endowment of the Arts, explores how museums, by investing in the creative economy, could do well by doing good.
–Elizabeth Merritt, VP Strategic Foresight and Founding Director, Center for the Future of Museums

Creative people solve problems. And increasingly they are doing it through business. Artists, designers and other creatives inherently care about where they live and the folks around them. That’s why the businesses they start are often social purpose businesses which balance financial profitability with environmental and social impact, employ their neighbors and strengthen their community.

To grow their social purpose businesses, creative entrepreneurs are looking for investors who share their values.  Investors who understand the power of the art, design, culture, and heritage to drive change and do good.

With more than $40 billion in their endowments, museums can lead the way.  By aligning their money with their mission, museums can help to pioneer impact investing in the creative economy.

Artists as Entrepreneurs

Here are three examples of artists disrupting the market through businesses that balance the financial bottom line with the planet, their communities and the interests of their customers and workers.

  • Artist and fourth generation farmer Matthew Moore’s new Greenbelt Hospitality puts a working, two-acre organic farm in an urban park, couples it with an affordable restaurant serving farm-to-table meals, and places education and art events at the core of the complex. This public-private partnership is starting in Phoenix, but will demonstrate a new type of public art in cities from coast to coast.
  • In Santa Fe, 200 architects, sculptors, painters, and other creatives have built an immersive art experience in an abandoned bowling alley attracting 500,000 people in just the last 12 months. The most Instagram-ed site in New Mexico, the state estimates that Meow Wolf will boost the local economy by $300 million over 10 years. A certified B Corporation, Meow Wolf has raised $158 million from conventional and impact investors to grow nationally.
  • Creative Action Network (CAN) is a global community of artists and designers making art with a purpose. CAN runs crowdsourced artist campaigns around causes, then develops the designs into a variety of goods, from apparel to housewares, which are sold online, benefitting the artists and the causes. A certified B Corporation, CAN has also adopted a steward ownership model to lock in its social purpose.

These are just three of more than 125 impact investment opportunities spanning sustainable food, social impact media, ethical fashion, other creative businesses and creative places (real estate) that Upstart Co-Lab is tracking.  In aggregate, these efforts seek more than $3.2 billion of socially-responsible and impact capital.  What the creative economy needs is more engagement from investors who share the commitment of artists, designers and other creatives to diversity, equity and sustainability.

Impact Investing

Impact investments are made with the intention to generate positive, measurable social and environmental impact along with financial return. $12 trillion in the United States – 25% of all assets under management – is currently invested for social responsibility and impact. Globally, sustainable investing assets in the five major markets total $30.7 trillion—35% of global assets under management of $88.5 trillion.  Growth is expected to continue as 72% of Americans indicate they have an interest in investing in environmental, social and governance funds.

Impact investing has evolved over the past 25 years so that today there are opportunities across all asset classes including public stocks; municipal bonds; venture capital and private equity funds; direct investments into early stage companies; debt and equity real estate funds; and even slates of films and video games. Investors can target their capital to deliver impact across a range of issues: oceans; forests; clean energy; affordable housing; sustainable farming; local food; ethical fashion and design; curing cancer; reducing recidivism; addressing chronic homelessness; promoting racial and social justice; providing access to capital to women entrepreneurs and entrepreneurs of color; addressing the needs of people with disabilities.

As the universe of impact investment deals grows, more evidence exists that impact investors can earn market-rate financial returns and achieve impact. As a recent Wall Street Journal headline put it: “Impact Investing Doesn’t Require Sacrificing Returns”. Last year McKinsey & Company called lower returns in impact investing a “myth”. Sharing their impact investing experience, investors like the Ford Foundation, the Rockefeller Brothers Fund, and the Russell Family Foundation report outperforming conventional portfolios. Based on these financial truths—and a commitment to their mission and values—the Heron Foundation and the Nathan Cummings Foundation have committed to investing 100% of their endowments in a socially responsible way.

Competitive financial performance and growing investor demand are reasons why the world’s biggest financial institutions now offer impact investment funds to their clients.  Bain, Blackrock, Blackstone, Goldman Sachs, JP Morgan, KKR, Morgan Stanley, TPG, and UBS have been joined by the World Bank and the country of Denmark and many others in launching funds for investors who want to make money—but not at any cost.

The Creative Economy

The “creative economy” was defined by John Howkins in 2001 as a new way of thinking and doing that revitalizes manufacturing, services, retailing, and entertainment industries with a focus on art, culture, design, and innovation. Today, creative economy definitions are typically tied to efforts to measure economic activity in a specific geography. Food, fashion, and media & entertainment are large segments of the creative economy.

My nonprofit organization, Upstart Co-Lab, is disrupting how creativity is funded by connecting socially responsible and impact investing capital to the $804 billion U.S. creative economy. Since 2016, Upstart Co-Lab has framed the creative economy as an impact investing priority, garnered international attention for impact investing in the creative economy, and connected more than $10 million of impact capital with creative economy opportunities. Upstart’s research has shown that the creative economy offers investors impact value, commercial viability, and innovative edge; correlates with diversity, equity, inclusion; and is relevant in both developed and developing markets. (Learn more at

What’s Next

In June, the Souls Grown Deep Community Partnership announced a $1 million commitment to impact investments, making it the first cultural institution to target its financial capital to investment opportunities aligned with art, design, heritage, culture, and creativity. Souls Grown Deep will specifically promote racial and social justice and economic opportunity through impact investment in funds, businesses, and real estate projects within the creative economy. We hope that Souls Grown Deep, a new entrant to the art world, can serve as a role model for others.

Museums and other cultural institutions in the U.S. with endowments of more than $58 billion can lead the way on impact investing in the creative economy.  Here are three things to get started:

  • If your 403B plan does not offer staff a way to invest for their retirement that’s socially-responsible, let your plan provider know you want to add at least one ESG option. Just raising the issue and making it clear this is a priority sends a powerful message to your plan provider and museum colleagues to invest in a socially responsible way.
  • Begin a conversation with your investments team and board of trustees. Work towards updating your museum’s investment policy to allow for socially responsible and impact investments. Invite leaders in the impact investing sector to share their learnings and experience with your organization.
  • Integrate impact investing into your next endowment campaign. Allow donors to designate the social impact they want to generate—for the environment, health, education—just as they would make a naming gift or endow a fellowship.

Dr. Maxwell L. Anderson, President of Souls Grown Deep, explained why: “As cultural institutions grapple with misgivings about sources of philanthropy, our board decided that it’s not just where we provide support, but how and with whom we invest that matters.”

Skip over related stories to continue reading article

AAM Member-Only Content

AAM Members get exclusive access to premium digital content including:

  • Featured articles from Museum magazine
  • Access to more than 1,500 resource listings from the Resource Center
  • Tools, reports, and templates for equipping your work in museums
Log In

We're Sorry

Your current membership level does not allow you to access this content.

Upgrade Your Membership


Leave a Reply

Your email address will not be published. Required fields are marked *

Subscribe to Field Notes!

Packed with stories and insights for museum people, Field Notes is delivered to your inbox every Monday. Once you've completed the form below, confirm your subscription in the email sent to you.

If you are a current AAM member, please sign-up using the email address associated with your account.

Are you a museum professional?

Are you a current AAM member?

Success! Now check your email to confirm your subscription, and please add to your safe sender list.