Yesterday, You’ve Cott Mail was devoted to the not for profit business model. I’ve always been a big advocate for looking at our business model and thinking about how we might do it better but as I was reading the email it struck me that whenever we are talking about business models we talk about non profit as if its somehow different from a for profit business model that isn’t broken. The basic difference is that in most cases, non profit businesses don’t pay taxes and many (but not all) philanthropic organizations require that you have IRS 501(c) 3 status in order to receive contributions.
It’s not like we sit around and think up ways not to make money so we can maintain our not for profit status. You never hear anybody asking if the for profit business model is broken, because that would call capitalism into question and in fact, well, maybe it is broken, but you see what I’m getting at right?
It’s not all the same – the non profit business model is not any one model – you can’t lump Northwestern Hospital and Greater Chicago Food Depository and Steep Theatre into the same category and say – yeah…not working. In fact many non profit businesses are thriving. But we are really talking about the performing arts. Paying bills, fulfilling missions, employing lots of people, being good citizens…many theatres are thriving as well, even if they do operate at a deficit. But you can’t operate a business, any business year after year at a deficit and expect to survive.
As I write this I say to myself, for once in your life you have to come up with some solutions. Well, sorry to disappoint you and myself…but here’s what I do have to say, we have to stop thinking about it like there is going to be solution out there that will fit all of us. Our ticket sales, in most cases, do not cover our costs. Contributions, in many cases do not cover the gap. I would suggest that we come up with more ways to diversify our income streams, invest in our future, think about our businesses as businesses that need to survive in the long term, but let’s stop talking about something that is broken and start looking at the real issue – we don’t make enough money and how are we going to change that.