In The Archipreneur Concept, architect Tobias Maescher explores new business models that architect-entrepreneurs are using to build game-changing, novel enterprises that are enriching the field of architecture. The fundamentals of how to break away from the convention of trading time for profit, create additional income streams to help sustain your practice when times are tough, and build your own projects are explored through real-world examples and actionable techniques. The book is a comprehensive guide to new business models for architects interested in practicing their craft in an entrepreneurial way, with each business model complemented with case studies of exciting new firms and individuals that run their businesses with scalability and efficiency in mind.
You will discover how to avoid common traps in passive income models, and how to take advantage of productizing architectural services through automation, building products, developing your own projects through co-housing initiatives, taking the lead in design builds, contributing to projects on tactical urbanism, and marketing your firm effectively.
The following is an excerpt from the chapter "Archipreneurship as a Solution."
Archipreneurship as a Solution
In reaction to the increasingly volatile job market, some architects have started to look to other industries for cues on how to compete. One of the most prominent changes to architectural practice has been the widespread adoption of business models from other industries.
Architects are clueing up to the fact that a successful business is as much down to the design of their business model as it is the design of their buildings. Savvy professionals are going beyond the traditional confines of the vocation and implementing:
- Market research
- Funding plans
- Financial forecasts
among others into their plans before they even think about launching their product or service. But traditional business models are simply more comforting for architects, and changes are not easy to implement.
In our talks with archipreneurs from all over the world, we have identified three major obstacles to building successful architectural practices:
Trading Hours for Dollars
Unless we’re really lucky, we don’t get to choose our clients, at least not when we’re just starting out. And unfortunately for us, the industry is still rife with clients who see architectural services as a cost, rather than seeing it as it is: a value. As a result, architects are often paid for their work by the hour. What’s the problem with that?
The information technology, publishing and retail sectors have all shown that hourly rates for entrepreneurs are at best outdated, if not totally inefficient, ways of doing business. If you only do work that charges by the hour, your income stops the moment you stop working. In order to break away from hourly rates, the onus is on architects to scale their businesses.
Lack of Business Acumen
We’ve said that architects tend to lack business & management development skills. If you’re interested in entrepreneurship (and if you’re reading this, we assume you are!) this can be a fatal oversight. Archipreneurs need more than experience in architecture and design: they need to understand how to design a business model.
A failure to understand the financial and the business sides of architecture is what keeps otherwise great architects from starting up great businesses. As architects, we know how to design, draw, write, interpret specifications and monitor construction processes. But it doesn’t necessarily follow that all architects will know how to manage a practice.
To run a firm, architects must learn:
- How to find loans and other financial support
- How to enter into leases
- How to manage cash flows
- How to work with employees
- How to source contractors and consultants
In addition, archipreneurs must start out by ensuring their businesses can turn a profit. That means setting aside more covetable roles to do with design and spending most of their time tending to management and administration. Sneer at management and administration at your own peril!
How can you develop business acumen without spending thousands on university management courses?
Architects are used to the traditional methods of getting clients and establishing networks. This false security makes small firms reluctant to invest in market research and marketing. But that completely underestimates the impact market tools can have on a business. We’ve already said that traditional roles are breaking down thanks to the globalization of the workplace – the same can be said for how businesses engage with their clients.
Where it once wasn’t necessary, or was only considered a nice luxury, it is now imperative for archipreneurs to have a solid and frequently updated web presence. Though many architecture firms do realize that they should have an online presence, most continue to struggle with how to use online marketing in a consistent and beneficial way.
To be thought of as authorities – or leaders – in the market, archipreneurs should engage with colleagues, peers and clients online by way of:
- Informative websites
- Social media accounts
- Blog posts
or a combination of the above.
Building a presence online need not be scary, or even difficult. In fact, the simplest and most cost-effective way to establish a strong brand and develop customer/client loyalty is to do so online. The success in differentiating yourself from the competition is in knowing how to use platforms and social media; how to build email lists and define your target market; and how to cultivate relationships and define your brand.
To become archipreneurs, architects need to redefine their offer by taking on board the new business structures available and the opportunities that technology has opened up for them. In order to become successful, set aside any negative preconceptions you may have about management and embrace the business behind designing buildings and creating products and services in the AEC industry.
Don’t be discouraged by an initial lack of knowledge in how to overcome the above three obstacles. Many of today’s most successful archipreneurs hadn’t a clue about running a business when they first started out. They made mistakes and experienced setbacks. But rather than give up, they looked to their peers for help.
In reading The Archipreneur Concept, you’re taking the first step.
The following chapter will look at how to overcome the three obstacles given above by detailing how the AEC industry’s most out-of-the-box thinkers run their businesses and stay at the top of their profession.