WolfBrown: On Our Minds

More on Mergers and Collaboration

February 17th, 2010

Although I hear that things are slowly improving in the economy, I know from my interactions with many nonprofits that the struggle is far from over.  Individual giving (except for extraordinary efforts like Haiti relief) is stagnant.  Foundations are still cutting programs, and governmental funding at the state and local levels is declining.  Organizations are fighting for survival, or making tough decisions about whether or not to survive at all.  As stories of hardship pile up, like this Wall Street Journal article from Feb. 2, more and more nonprofits are looking towards collaborations and mergers as viable strategies. We have previously addressed these issues in our Sounding Board and On Our Minds publications trying to focus a spotlight on the possibilities, challenges and problem-solving approaches to collaborations and partnerships. But, more work needs to be done to design and develop these delicate transitions, as economic forces inevitably reshape the sector.

 

 

The Ultimately Portable Orchestra

February 17th, 2010

Skimming through the The New York Times online video library, I happened upon a piece about a new type of orchestra born at Stanford University, and consequently, at many other places throughout the country: the iPhone Orchestra.  Not only can one make this multi-dimensional communications device a flashlight, or replicate the visual action of drinking a pint of beer, but it can now be your own portable “anything” musical instrument. What the Stanford orchestra has done is not just create a simple app (although these have subsequently been developed and are currently available), but applied their efforts to explore and stretch the capabilities of this device so that it becomes a flute, a drum circle, wind chimes, and produce many other sounds not yet imagined. Although computer-based replication of instrumental sounds is nothing new, the iPhone as an instrument may be the device that levels the musical playing field (just as the portable and then digital camera did for fine art photography) by allowing anyone to compose and play original music at the touch of their fingertips. Ge Wang, one of the founders of the Stanford iPhone Orchestra considers the ability of anyone to take up the iPhone and create new sounds to be one of the basic principles of the iPhone Orchestra, ”It’s my philosophy that people are inherently creative.  It’s not just people who think of themselves as artists.”  Our research into cultural engagement underscores Wang’s philosophy – everyone has creativity embedded in their DNA.  Compose while waiting in long lines at the DMV, or hold an impromptu jam session with friends after dinner.  The possibilities are endless.

 

Grants in Sheep’s Clothing

February 17th, 2010

I’ve been thinking a lot lately about how nonprofit arts groups account for grant funds and other capital investments.  Everyone in the business sector understands the need for raising capital funds – through issuing stock or assuming debt – to finance new products and other business improvements.  In fact, many businesses fail because they were not adequately capitalized.  How do nonprofits capitalize their business models?  The short answer is, they don’t.  Endowments – for the lucky few who have them – are mostly restricted and cannot be expended for product development purposes.  Otherwise, investments in new programs have to be paid out of operating funds.  Typically, this only happens when special grant funds come available.  Because there is no generally accepted way of accounting for capital investments differently than operating revenue, however, grant funds disappear into overhead as fast as you can say “unsustainable practice.”  I like to use the analogy of a snake that swallowed a pig.  When the pig is gone, what’s left is a fatter snake that is very, very hungry for another pig.  Clara Miller, CEO of Nonprofit Finance Fund (NFF), is a champion for better capitalization methods for nonprofits.  I heartily recommend her incisive essay, The Equity Capital Gap.  Over the next four years, I’ll be co-leading, with Arthur Nacht, an evaluation of NFF’s Leading for the Future: Innovative Support for Artistic Excellence initiative, funded by the Doris Duke Charitable Foundation.  This experimental pilot program seeks to develop more sustainable approaches to financing artistic success, and should generate many valuable lessons for the field.

 

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