39 Days of IDEAS | Day 5: Investing big in the arts
In 2011, the Metropolitan Atlanta Arts Fund (MAAF) surveyed the financial health of 40 nonprofits they’d supported over the years, and found that “this cohort of fantastic, creative, mature, highly productive arts organizations had extremely low liquidity,” said founding Director Lisa Cremin. “This was no way to do business.”
What these organizations needed, the MAAF decided, was capitalization: an injection of funds large enough to give them the security and adaptability that comes with a significant reserve. That meant a grant of unprecedented size for the MAAF: $200,000. Said Cremin, “You can’t short-change a capitalization plan and expect it to work.”
Knowing that the recipient would need training to steward the investment, and that help from the sector as a whole would be needed to further the effort, MAAF designed a pilot program to educate consultants, funders, and nonprofits in capitalization principles. After considering six nonprofits who might be ready for capitalization, they decided on three finalists, each of whom got 50 hours with a MAAF-trained consultant to develop a 15-minute pitch for the funding committee.
The MAAF wanted to make sure that each finalist walked away with a compelling pitch, but also that other investors were ready to hear them. That’s why they briefed the funding and business communities on the concept, and roped in members of those communities to act as pitch coaches for the finalists. Said Cremin, “We knew we were going to need a lot of different partners on different levels” to start a capitalization movement for Atlanta’s arts organizations.
Following the final pitches, much deliberation, and days of reflection, the MAAF selected the Atlanta Contemporary Art Center (a GCN member) for the $200,000 capitalization grant. Cremin said the grant, announced in May, is just the beginning: the MAAF will be helping all three finalists continue their work capitalizing and seeking capitalization funds, and will be tweaking the pilot program for the next round. “Our real hope is to get some more investors for the other organizations, and start focusing on evaluation and planning for where we go next,” said Cremin.
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