10/04/2013

What are they really selling at Burning Man?

the burning man center camp cafe
the cafe, one of the places where one can buy stuff at the event
People who are familiar with the annual Burning Man art and culture event held in Nevada's Black Rock Desert are likely aware that the organizers have an interesting relationship with money. The fact that burning man is, and has been, a profit making business is clear, with founder Larry Harvey saying, in a 2011 speech in reference to a potential transition to a non-profit, “Burning Man’s not anti-capitalist”, continuing about the financial goals of the organization saying that they desire “profit enough.” Most people in a leadership role within a multimillion dollar a year business do not make such statements. Some might wonder what makes burning man different in that regard. The most likely difference with this business is that it relies largely on volunteers to provide nearly all of its value. The organizers have, for roughly 20 years, likely tread carefully on the subject of money due to the very large amount of sweat equity that the uncompensated ticket buying participants put into the event, but, also, because of the supposed founding principles of its organizers. In a 1999 newsletter Larry Harvey had this to say about the beginnings of the event:

We were illegal, going down to the beach to burn this thing. And we depended for our resources, not on grants, and not on sponsorship, and not anybody’s funding, but on our own communal efforts undertaken together.
The idea that, in some way, burning man is somehow different from other festivals, events, or businesses is a sort of cultural known within much of the burning man community. The idea of communal effort is often at the heart of this concept, with many in the community, and the organizers themselves, feeling that they are undertaking The Project, as it is sometimes referred to, together. Communal effort later ended up being one of the so-called 10 Principles that the organizers created to help clearly define what was important to the culture and community that built up around burning man.


In 2004, in an ongoing effort to expand the burning man brand beyond the event-site in Nevada, and its business home, in San Francisco, Black Rock City LLC, which owns the burning man brand and operates the event, created what they refer to as the 10 Principles. At the time these principles were created to help guide those people tasked with organizing regional communities and events. The principles have now come to define, according to organizers, the ethos of the community that has sprung up around the event, representing what burning man, in part, is.

One of the ten principles that many in the community embrace is known as Decommodification. The organizers believe that applying this principle protects the community from exploitation.
Decommodification In order to preserve the spirit of gifting, our community seeks to create social environments that are unmediated by commercial sponsorships, transactions, or advertising. We stand ready to protect our culture from such exploitation. We resist the substitution of consumption for participatory experience.
Along with applying the principle of decommodification as it relates to the event, the principle is, in its own way, applied to the brand itself. Participants who have invested heavily in the event, creating the attractions which make the event what it is, were guided in an email from the burning man Intellectual Property Team on the acceptable way to use the brand as it related to the fundraising efforts that are often undertaken by ticket holders to bring their projects, both large and small, out to the desert in Nevada.
Burning Man has federally registered symbols depicting The Man and words like “Burning Man,” “Black Rock City,” “Decompression,” “Burnal Equinox,” and “Flambe Lounge” as trademarks of Burning Man. We do this so that we can protect these symbols or words and make sure that third parties cannot use these items for commercial or other unwelcome purposes, or otherwise associate themselves with us, causing confusion as to Burning Man’s involvement. This also helps us preserve the Decommodification and Gifting Principles that are an important part of our culture.
gift necklaces with the burning man logo
logo-clad burning man gifts
This message, sent from the organizers to individuals running the nearly 1000 theme camps that form the core of the event, continues on what isn't allowed in terms of profiting off of the brand.
You cannot sell any items with Burning Man’s trademarks. This includes vending online in peer-to-peer resale spaces as eBay or Etsy. (Examples: selling a Burning Man logo t-shirt for your theme camp on eBay or selling earrings with the man symbol on Etsy- Not OK!)
As the yearly event has continued on for over 25 years there has often-times been disagreement within the community over who actually owns burning man, or, at least, who deserves to share in the stewardship of the event and the equity created by it. As the event is largely created by the ticket buyers, with the canvas, or clean slate, being organized by the LLC, this disagreement about who owns the event and its profitable brand is largely understandable.

Of the 1000 Theme Camps, 700 moving art pieces, known as Mutant Vehicles, and 300 stationary art projects or sculptures at the event the organizers provide some funding for materials for roughly 30-50 of the art projects and sculptures per year. The LLC, which has been responsible for organizing burning man for for over 15 years, pride themselves on the fact that the event is largely made by the attendees themselves, attendees who pay for the privilege of attending. Along with nearly all of the attractions being provided by paying customers the event is largely reliant on volunteer labor. In response to a voluntary self-selected census conducted by burning man in 2011 17.6% of census-takers claimed that they volunteered for the event in some way. In a year when over 53,000 people attended the event this census, while not scientific, would represent well over 7500 people providing the free labor which helped allow the event to happen. Nearly 50% of respondents to the same census considered themselves as part of what are known as Theme Camps, which serve as the interactive core of what brings many to the event.

volunteer pin on burning man hoodie
thousands do volunteer work at burning man
In an apparent effort to provide some transparency the LLC has, for over 10 years, made public on their website an accounting of their event related expenses. Notably missing from these so-called Afterburn financial reports are any funds coming in to the business.

The Missing 68%

Over the years the organizers have, also, in the process of selling tickets, made mostly public the pricing structure for the tickets sold. This information, with the public disclosure about event attendance in relation to the permit for the event, has led some to conclude that burning man largely breaks even, or, makes a meager profit. These people are not far off, if income from tickets were the only source of money for the LLC. When one adds up the ticket sales and compares it to the expenses listed by the organization it seems that with tickets alone the organizers are able to pull it off without any other sources of income. But there appears to be another source of income.

As per the federal Bureau of Land Management Special Recreation Permit (PDF) that the event organizers agree to comply with when holding the event they must pay a usage fee of 3% of the gross income from all payments related to the event. When one compares the 3% of gross ticket sales with the BLM fees listed in the expense reports the LLC releases (link to 2012 expenses) there is a noticeable gap. If one takes, for example, an estimate for ticket income in 2012, roughly 19.2 million dollars (archive of 2012 ticket page), and accounts for a 3% fee, one only comes up with roughly 577 thousand dollars, when the organization claims to have paid a fee of 1.86 million dollars. When solving for the amount of income that would account for a 1.86 million fee, representing 3% of event related payments in 2012, the income for the year ends up being more like 62 million dollars. With the claimed total expenses for the 2012 year being roughly 22 million one might start to wonder where all of that extra money is going. And, perhaps, more importantly for some, where that extra income is coming from.

burning man estimated income graph

Looking at the chart above, which is, as noted, merely estimates of event related income taken from the 3% fee that the BLM demands, and the LLC pays, over the 4 years listed, Black Rock City LLC appears to average roughly 68% of their event related income from something unrelated to tickets.

If burning man were any other event one might think this means nothing at all, as vending and sales of merchandise could represent a large portion of an events income. Unlike many other events, though, one cannot buy a T-Shirt or visit a selection of vendors offering food at burning man, as it is, theoretically, a decommodified zone. As its organizers often seem to imply burning man is not just any other event. As noted previously, unlike many other festivals or events, the organizers of burning man appear to feel that the event is a communal effort undertaken together in partnership with the ticket holders, who cannot buy anything buy ice and coffee, and whom are told to bring everything they need to survive for the 8 day event..

The possibility that 68% of the estimated income of the LLC (in 2012, perhaps $43 million dollars) may have been unrelated to tickets and may largely be profit might be a cause of concern for some of the uncompensated ticket buyers and the many thousands of uncompensated ticket buying volunteers (some working 30 hours or more during the 8 day event) who have invested large amounts of sweat equity in the brand, and event. If, as suggested by organizers, burning man is a communal effort undertaken together, the apparent windfall profits going unshared with those who make the event possible might justify such concern. In light of the fact that organizers cherish the idea of decommodification, in an effort to avoid individuals or entities exploiting the hard work of those uncompensated artists and volunteers in the community, some might wonder if the LLC receiving large amounts of income from an unknown source is accomplishing exactly what the LLC claims to want to avoid: exploiting those within the community. It is unclear if the LLC feels that exploitation of the hardworking volunteers and people who bring nearly 2000 attractions to the event can occur only from an outside source, or only without the blessing of the LLC itself.

What are they really selling at Burning Man?

If ticketing really only represents roughly 30% of LLC income it might stand to reason, in the minds of some, that the business of burning man really is not about selling tickets to an event or festival. When it comes to making profit off of burning man it has been argued by the LLC itself, along with some of those within the community, that it can easily turn in to a business or individual exploiting the gifts of those ticket buyers who bring art, theme camps and various projects to the event, many of which cost tens of thousands of dollars, or more.

It would be natural for someone looking at the business from the outside to question, beyond tickets for entry, and with traditional vending and merchandise sales forbidden, what types of things at burning man have enough value that someone might pay sums which, potentially, end up totaling well over 30 million dollars. A hint about where some of this non-ticket money comes from came from a recent 2013 interview featured in the San Francisco Bay Guardian.
Goodell said the LLC’s standard agreement calls for all filmmakers to either pay a set site fee or a percentage of the profits. “It’s standard in all of the agreements to pay a site fee,” Goodell said, noting that the LLC recently charged Vogue Magazine $150,000 to do a photo shoot during the event.
Along with site-fee funds and the likely residuals, or, profits, from photography, magazine spreads, videos, book and film projects the LLC is likely, also, to, in some way, profit off of those individuals and businesses selling on-site services at the event. Some of these services, such as those provided by Turn-Key camps, as they are now referred to by event organizers, provide, among other things, RVs delivered to camp sites, or, in some cases, services akin to all inclusive accommodations, complete with catered meals. While unconfirmed, these businesses, which operate with the blessing of the LLC, may also share revenue with the LLC.

With expenses accounted for, and if the estimates are valid, the LLC may have made almost 43 Million in profit in 2012. It might stand to reason that some of that extra income could be used to allocate more money to funding art grants than is already set aside for it, roughly 700 thousand in recent years. The income, if extant, could also be used to help fund those theme camps and mutant vehicles which have never received an LLC grant and whom struggle to make ends meet with out of pocket spending and fundraisers. Another place this income could go, if the estimates are true, is to compensate many of the volunteers who go unpaid, or, to increase the compensation for those who are already being given payment for seasonal event related work. Though, with a long history of repeat volunteers, and artists, who are committed to the work that they enjoy doing, even without compensation, it seems that expending this income on such things might not be required to keep the thousands of volunteers, artists, and theme camp operators engaged.

With all of these highly engaged people who are, essentially, working for free, whether it be volunteers, theme camp organizers, or artists, it seems like the decision made long ago, to consider decommodification a core of the burning man ethos, in an effort to protect the community from exploitation, was a good one. The unfortunate thing about that decision is, though, that it may appear to an outsider that the legal and cultural efforts that the LLC has undertaken over the years to uphold that promise to stop outside actors from exploiting the community who willingly gift their labor, time, and effort has been for naught. If the estimates are true an outside observer might conclude that it appears as if the threat of exploitation of the hard work and sweat equity of the burning man community comes not from outside, but, from within the LLC itself.

If the example made in 2011, when KRUG Champagne decided to do a photo spread (which was later given to Town and Country magazine and W magazine for publication) at burning man without the permission of the LLC, is any example of how things happen an outsider might very well see that the only use of the so-called principle of decommodification, in light of the aforementioned $150,000 site-fee that Vogue Magazine paid for an editorial photo spread, appears to be to ensure that the LLC gets their cut of the money. Speaking about this 2011 incident in a blog post in May 2012 the writer, who helped form the burning man media team in 1997, wrote
Burning Man allows media members to publish photographs in the weeks around the event, so long as they are published only for editorial purposes. Branded articles and product placement do not fit within that permission. After the event, we found that W Magazine had published a photo essay of the dinner. We approached W Magazine about this transgression, and it had the good sense to take their photo essay on the dinner down.
They continued about what happened with the other publication, Town and Country, which asked for permission to reprint the images:
Town & Country Magazine contacted us post-event for photo review and permission. By that time, we had found out that this was not a real Burning Man event, but a product placement story, and we refused permission for Town & Country to publish any photographs from the event. Sadly, they sent the story to press anyway, very much in violation of the photographer’s agreement with Burning Man which prohibited any such publication. Unfortunately, the timing was too short for us to file a lawsuit against them enjoining the publication. That’s what BMHQ [ed: BMHQ is the LLC business headquarters] does to prevent this type of commodification.
The concept of decommodfication as it applies to burning man, may, for those outside of the culture, be difficult to understand. In one case, a magazine such as Vogue, which paid a $150,000 site-fee to be permitted to sell photographs of models at burning man in a widely distributed magazine is not exploitation, but the above example, where two companies used, or intended to use, photographs of models to sell magazines is exploitation. The main difference, from the viewpoint of casual observer, may be that one was done without previous LLC permission, and, also, done without paying the requisite site-fee or entering into a profit sharing agreement. The same casual observer might wonder what the difference is to the community, which gifts its hard work, if someone prints burning man photographs in a magazine for profit while paying the-site fee to the LLC or sharing profits with the LLC and someone who pays no-site fee and shares no profits with the LLC, if none of that income ever ends up directly benefiting said community, or, in the hands of those who create nearly all of the value of burning man; the ticket holders and volunteers.

It seems, if the estimates of the income based upon the 3% fee to the BLM are valid, that an outside observer could easily conclude that when it comes to decommodification Black Rock City LLC, which owns the burning man brand and produces the event, are protecting themselves from being exploited financially, not the community who gift their efforts and create nearly all of the value of the profitable burning man brand. An outside observer could, if the estimates are valid, likely easily conclude that the ones who are most likely engaging in exploitation of the gifts of the artists, theme camps, volunteers and mutant vehicle builders, are those within the LLC itself.

Whether the highly engaged community likes it or not, when it comes to the question of "What are they selling at Burning Man?", and one looks at all of the books, film projects, magazines, and other media that entities sell on the open market, the answer seems that it could very well be: you.