In my July/August column of American Theatre, I imagined a to-do list for our theatre field with a couple of long-standing challenges that we may never fully check-off. One more topic to add to that list: the need for theatres to achieve proper capitalization for organizational vitality.
Jump back with me fifteen years. I’m facilitating a conversation among artists, administrators and trustees at a retreat for TCG’s National Theatre Artist Residency Program, in my incarnation as managing director of The Wilma Theater. The conversation will seem familiar—we commiserated over the challenges of creating vibrant artistic work amidst stressed budgets and cash flow crises. Then, the a-ha moment…the theatre field is undercapitalized, and what if TCG could help lead the field towards healthy capitalization?
Little did I know that I would one day be in the position to try and make good on that epiphany. We’re knee-deep in planning our 2013 Fall Forum on Governance in New York City, from November 8-10. Inspired by the positive response to the “Getting Beyond Breakeven” sessions at the 2013 Conference in Dallas, we’re making capitalization the major theme of the Fall Forum, along with our continued focus on advancing diversity & inclusion.
To make this Fall Forum even more impactful, we’ll be partnering with organizations such as Grantmakers in the Arts, who recently launched the National Capitalization Project. GIA is undertaking this work with collaborators that include the Nonprofit Finance Fund (NFF), who bring a deep knowledge of capitalization best-practices. NFF has also worked closely with TCG on its own financial analysis, and gave a series of webinars to assist TCG Member Theatres coming out of the 2008 economic crisis. Another key partner is Technical Development Corporation, who published the study “Getting Beyond Breakeven” (PDF), that led to author Susan Nelson’s Conference session of the same name.
While many of you are already advanced thinkers on this topic, we continue to hear from you about the importance of bringing trustees, theatre leaders and funders together to examine the fundamental realities of how our theatres are faring when it comes to annual operating results, working capital, building reserves, risk capital and more. We’ll empower attendees to develop strategies and refine tactics to strengthen capitalization. There will also be an opportunity for frank peer conversations about the causes of undercapitalization, and open dialogue with the funding community about challenges and opportunities in that key relationship. This is especially important knowing that many funders focus on project specific grants, and the idea of helping to eliminate deficits and build reserves—let alone providing core operating support—continues to be the exception, not the rule.
The past several years at the Fall Forum, I’ve joined TCG managing director Kevin E. Moore in presenting the findings from our Fiscal Survey; and every year, one major challenge stands out: theatres are struggling with working capital. Theatre Facts 2012, which we’ll share at this upcoming Fall Forum, will unfortunately not buck that trend. But, if we can create space for the action planning and honest dialogue necessary to shift our theatre field towards proper capitalization, perhaps the 2028 Fall Forum on Governance will have us looking back at this November as the moment when something significant changed for the better.
What challenges, questions and ideas do you have regarding capitalization?