The Brave, the Smart, the Entrepreneurial

african-american business

According to Giving USA 2013: The Annual Report on Philanthropy in America, private sector giving to the arts was $14.4 billion in 2012, a 7.8 percent increase from the previous year. However, many Americans still do not see the arts as essential to society. This is why during the peak years of the Great Recession a bulk of America’s charitable dollars went to social causes such as education, healthcare, and youth programs. For long-term success, small non-profits, including African American organizations, must create new business models that generate multiple streams of income because the charity dole is unpredictable.

The 2000s saw the expansion of non-profits including Susan G. Komen for the Cure, Habitat for Humanity, and Teach for America. These large-scale entities, flushed with dollars from big-name philanthropists and social entrepreneurs, are thought by many to be more effective at addressing society’s greatest challenges. Furthermore, we have seen drastic cuts in government funding for the arts since the economic crisis began in 2008. Small non-profits, including African American organizations, are in a precarious position as they mainly depend on government coffers for their organizational sustenance. While they will not completely make up the gap in government funding, it’s likely that in the near future, big-name donors will have a determined say on which non-profits will wither, and which ones will grow.

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These structural disruptions in the non-profit world ultimately threaten the existence of small organizations. What if, like African American non-profits, your natural donor base has limited wealth? What if, like African American non-profits, you cannot secure the support of a big-name donor? What if, like African American non-profits, local stakeholders cannot comprehend how vital your organization is to your community’s health? 

We must consider radical business strategies if we are to survive in this new normal. I am not suggesting that we give up on traditional philanthropy, but I am advocating that we create value that can be monetized to our core and broader audiences. To do so we must think like entrepreneurs and take risks – we must venture into sectors not traditionally associated with our organizations.

Most of us working in the arts solely think of earned income as gift shops, facility rentals, and cafeterias. It’s time for us to start thinking about expanding our cultural offerings to the popular arts – in areas including theatrical plays, popular music, and films. There are successful promoters and producers waiting to partner with us to mitigate risks and maximize the potential for large rewards. In 2013, arts and culture’s share of all charitable donations was only 5 percent. To survive, we need to be brave, be smart, and above all, be entrepreneurial!

John Guess Jr., is the CEO of the Houston Museum of African American Culture (HMAAC). 

Source: Giving USA 2013: The Annual Report on Philanthropy in AmericaAmericans for the Arts, Arts USA, Metro.us

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