What does it take to be a successful arts organization in Silicon Valley?
By: Connie Martinez, SVCREATES’ Chief Executive Officer
What does it take to be a successful arts organization in Silicon Valley? The simple answer is that the arts need and deserve more money. While that is true, I think it is the wrong answer. And, for the record, I have never heard of a region where arts organizations do not believe they need more money, including my home state of Minnesota, which ranks number one in our nation for per capita investment in the arts.
The more complex and accurate answer, based on years of experience, research and observation, is that four interdependent factors fuel the success and resilience of Silicon Valley’s arts organizations.
The first is the relevance of the art offerings. Relevance does indeed trump excellence bearing in mind, of course, that quality is always relevant, and that relevance is very much relative to the donors and audiences that live here. The San Jose Repertory Theatre and Ballet Silicon Valley did not fail because they produced inferior performances. The School of Arts and Culture at Mexican Heritage Plaza did not become a smashing success and a magnet for community engagement because of their partnership with the Smithsonian. The School is financially stable because of their relevance and affordable offerings to the community they serve and to the donors who care. Relevance in our Valley is often aligned with demographics and with our participatory, “DIY” culture.
The second is an organization’s ability to connect with and engage the people who care about what they have to offer (value) and find their offerings accessible to them (location and affordability). I was recently part of a Chinese community theatre production of The Joy Luck Club. We had four sold-out performances in a mid-size theater each with cheering and engaged audiences — the audience was primarily Chinese and mostly family and friends who connected by word of mouth. Compare this to the 40,000 individuals attracted to the remarkably beautiful and wildly successful Bruce Munro Stories of Light exhibit at Montalvo. The approach employed by the Montalvo was, of course, significantly different than the approach taken by the Chinese community theater, but the need for a connection to people who cared (value and access) was the same.
The third has to do with cultural entrepreneurship. In a place that knows and values the qualities of an entrepreneur — the organization that is nimble, innovative and takes calculated risks is best equipped to navigate our marketplace. Andrew Bales of Symphony Silicon Valley comes to mind, as he hustles and successfully produces a series of Harry Potter and Star Wars symphony concerts for our “geekish audiences” while offering a traditional “quest conductor” season of Mozart and Beethoven for his more traditional audiences at a fraction of the cost of most American city symphonies.
Lastly, business models that “lean market” and keep operating costs low in relation to programming expenses do best. That means keeping the balance of earned income (e.g. ticket sales, memberships, retail, etc.) and contributed income (donors) growing proportionately together. For example, San Jose Jazz has about a $2M budget with a staff of six full-time employees, and nearly 70% earned income. As their audience grew to 65,000, their earned income ratio has remained steady and the amount of money they need to raise each year has remained manageable. Most people pay San Jose Jazz for their experiences (leans market) and most donations are used for programs to increase access to music and arts for children who would not otherwise be able to participate. Likewise, smaller organizations like San Jose Taiko have grown their audiences while keeping their cost structures in alignment with the market, and have grown to international acclaim with a budget of less than $1M. Both are examples of business models that have worked for decades.
Every region believes they are unique, and they are. But not every region has experienced the technology and innovation, wealth creation, demographic shifts, and the forces of what Joseph Schumpeter coined “creative destruction.” Do not underestimate the impact of the Valley’s constant churn and scrappy start-up culture on our arts ecosystem. Only those organizations who find their relevance in this marketplace and learn how to market within their unique niche, and do so with an entrepreneurial flair and market-driven business model will succeed and thrive for years to come.
