A little more information about A-Corporations I wrote about last month. Paddy Johnson writing for Hyperallergic had a little more detail and insight into how the corporate structure might be used.
One of the biggest benefits mentioned is that an artist could create an A-Corp for themselves without the need to hire a lawyer as they would when creating an LLC. That would gain them the protection of isolating their personal assets from their professional assets. The article suggests creators of public art might find that particularly important.
As I had mentioned in my earlier post, another important benefit of an A-Corp would be to allow the artist to retain 51% controlling share of their work. Hyperallergic gives some examples of the types of groups which may value this protection.
The rest of the benefits currently better suit musicians, filmmakers, NFT artists, and large collectives like Meow Wolf — artists with predictable, recurring revenue streams. In these cases, it makes sense for an investor to purchase shares to buy into the company’s future earnings. It makes sense, then, the A-Corp requires artists to maintain 51% voting rights and have a stated artistic mission. The last thing you want is a bunch of investors deciding what your art should look like.
I hadn’t realized Meow Wolf was organized as a large collective of artists until I read this.
One thing I had been wondering when I read the initial reporting on A-Corps was how they would allow artists to leverage their numbers to get healthcare. I could see how an entity as large as Meow Wolf might benefit, but what about artists operating on a smaller scale?
In fact, Yancey Strickler, the person who has been central to advocating for the creation of the A-Corp form has been thinking about that. In the Hyperallergic piece he is quoted tracing the arc of business development from social media giants laying waste to the media environment, the trend toward everything being a subscription, and then an emerging trend toward smaller, private communities.
If we moved to private communities where we owned our content and could monetize it ourselves, perhaps we wouldn’t be so beholden to giant tech companies…
As it turns out, Strickler’s next project, Dark Forest Operating System, purports to offer just that. The idea is to create an entire ecosystem of collaborative artist-led communities, which would own their creative materials and charge for them. They would be able to join together to create a federation of A-Corps, pooling members to hit the thresholds that unlock true group insurance — the kind tied to employment, not the individual market plans most artists are stuck with…
Paddy Johnson quotes a piece in the Cardozo Arts & Entertainment Law Journal which points out that how Strickler might envision the new corporate structure being used and how artists actually use it may not match. Artists being both non-conformist and creative may not avail themselves of some features but may flourish in unexpected ways thanks to other opportunities the structure provides.
