Architects have a reputation for being bad at business. This stereotype is not entirely unfounded: The disregard for business is systematically cultivated all through our educations and professional lives. Apart from sporadic mentions of clients at architecture schools, students are largely deprived of lessons on running enterprises and making profit. While this unfortunate state may be gradually changing, there is no way around the fact that the majority of our schools are still based on an outdated educational model that is as divorced from the reality of the AEC industry as most mainstream architectural practices are reluctant to adjust to the cultural and technological shifts taking place in other industries.
The fact that the number of licensed architects is increasing, and the average age of those achieving licensure is at a record low, may seem encouraging at first, but it also means that too many of us are entering the workforce every year. We compete for the same clients who can afford good design and pursue jobs that will provide maximum creative freedom and exposure. However, most end up spending years, decades even, working for others, gaining no significant insight into how companies operate, attract clients and negotiate.
The Cresta by Jonathan Segal FAIA, California City, Calif., United States
When they choose to strike out on their own, architects tend to follow the outdated model of trading hours for dollars. One of the consequences of this mindset is the fact that clients continue to perceive architectural services as a cost rather than a value. Those who are open to learning from other industries realize the inherent problem in having to reinvent their services with every new client and adopt superior business models based on efficiency and speed. They recognize the crucial role of well-defined value propositions, smart branding, differentiation strategies and marketing in the growth of their companies. Many among them automate large portions of their workflow, create efficient organization and time-management systems and take a proactive approach in acquiring clients.
So, what are the alternative routes for architects to practice their crafts with autonomy and make a profit at the same time? In order to organize and clarify the various “archipreneurial” trends that have emerged over the last few decades, Tobias Maescher — founder of archipreneur.com — has created a comprehensive compendium of archipreneurial practices entitled The Archipreneur Concept: New Business Models for Architects, which explores the crossover between architecture and entrepreneurship through examples of innovative firms of different sizes and profiles.
Own It, Design It, Build It
One of the chapters in the book focuses on architect and developer Jonathan Segal. Trained as an architect, Segal went into real estate soon after graduation and briefly worked for a developer before starting to build his own projects. His urban infill residential developments are located on “undesirable” lots and can easily be converted into commercial spaces. The houses usually have no elevators, balconies or underground parking garages and are meant to be economically viable and sensibly designed. Segal is a firm proponent of being the owner, designer and contractor.
There is also a way for existing design studios to optimize their business models by transitioning from design services to becoming a design-build developer. A great example is SHoP Architects and SHoP Construction, collectively known as SHoP. Its foray into development happened with the Porter House project, for which it approached a developer with a smart, space-efficient design.
The firm took out an equity interest in the building and used the profits to finance four other collaborative development projects. Since then, SHoP has developed a hybrid business model as designers and real estate developers, working on their own projects and offering design services to clients. A large part of its success can also be attributed to its innovative fabrication techniques that help cut costs and speed up construction.
The Porter House by SHoP, New York, N.Y., United States
Design New Tools for Architects
Product development is another big trend among architects. In the last decade, there has been a proliferation of apps and software for the AEC industry designed by interdisciplinary teams that include architects. Sometimes these products emerge organically, as solutions to internal problems of architecture firms.
Steven Burns, FAIA, developed the rudimentary version of cloud-based time and project management software ArchiOffice as a way of solving his own problems as principal of a Chicago-based design firm. He had created a tool that automatically tackles issues such as time tracking, budgeting, project management and billing. Other firms in the area tried the software and loved it. In short, Burns decided to go into software development full time and joined BQE Software as chief-creative officer.
Olympic Stadium by Populous, London, United Kingdom
Master Your Marketing
Another predominant fallacy among architects is the idea that, if they do good design, clients will somehow come to them. This misconception is at the root of marketing failures many architecture firms experience. Even international companies with large marketing departments suffer from a chronic disconnect between their design and marketing teams. Smart branding, use of inbound marketing and selective use of social media are some of the key practices separating successful firms from those that struggle to stay afloat.
Populous seem to have mastered the art of using smart marketing strategies. Their brand, expressed in the tagline “Drawing People Together,” is in line with their specialization in designing sport facilities and convention centers. Even their name is consistent with their philosophy of building for people and communities. Images of their projects tend to accentuate the presence of people and the way they use space. Data acquired through surveys and marketing campaigns informing their designs, creating an ecosystem that draws together different aspects of their work.
China Wood Sculpture Museum, photo by Iwan Baan
The majority of architects either ignore social media platforms or spread themselves too thin by inconsistently using too many. Many fail to use them to foster communities and cultivate a dialogue with their audience. For Iwan Baan, probably the most sought-after architecture photographer today, Instagram is a great tool for creating narrative and sharing behind-the-scenes photos of buildings and places he visits. He documents his journeys and shows a different side of architecture. Bjarke Ingels is also an avid user of Instagram. Similarly to Baan, BIG’s founder also uses the platform to reveal a more playful, informal side of architecture.
Diversify Income Streams
There are many ways architects can practice their crafts outside of the prescribed norm. They can optimize their time and workflow through partial or complete automation and get projects built by assuming the role of the developer and/or contractor. By creating passive income streams, architects can ensure that their young studios survive when business is slow and have the freedom to choose projects they take on. Publishing e-books, organizing webinars and podcasts and blogging can all provide additional revenue streams and act as great marketing tools, as well.
Check out The Archipreneur Concept for more information on business models that best suit your interests and expertise.
Top image via Illusion