Is it a problem when an arts group is too dependent on a single donor?

Dancer Jin Young Woon of Cedar Lake Contemporary Ballet
source: Cedar Lake Facebook page, photographer not credited

The recent case of Cedar Lake Contemporary Ballet in New York City shuttering as a result of the withdrawal of support from their major benefactor, Nancy Laurie, an heiress to the Wal-Mart fortune, has sparked a dialogue around the pitfalls of over-reliance on a single donor. The New York Times wrote about the dance company's closure here, and Michael Kaiser addressed the larger issue in a blog post here.

Clearly, significant dependence on a single donor by an arts group poses serious challenges, and adds to institutional risk. On the other hand there has been a significant growth of arts institutions, largely in the visual arts, that are the creation of single donors/collectors. Would the excellent Neue Galerie in New York be able to survive without the support of Ronald Lauder and his family wealth? Unlikely.

And many of our now-great institutions with diverse funding began as the creature of a major benefactor. Carnegie Hall, of course, was the creation of Andrew Carnegie and his wife, and after his death came very close to disappearing.

It seems to me over-dependence on a single donor has been a phenomenon within the arts since the dawn of "the arts" as we know it, going back to court patronage. In many instances we need to look at largely single donor entities as creatures of their donor, that depending on the donor's desire, or lack thereof, for the entity having sustainability beyond their support, will either disappear based on the choices of that donor, or survive, based either on the careful work of the donor to wean the group off their support, or the efforts of other donors and leaders to sustain the organization.

Thirty years ago, when I became the first Managing Director of the Vineyard Theatre in New York, it was heavily dependent on the support of founder Barbara Zinn Krieger and her family. She, however, clearly understood the necessity of the organization building a diverse base of support, and during my four years there we steadily reduced her share of our philanthropic support from about 75% to 25% (if my recollection of budget numbers from so long ago is accurate). Now the theatre is thriving and fully independent of its founder's support.

But success in weaning an arts group of an unhealthy reliance on a single donor, is often dependent on that donor being committed to the effort, and sometimes needing to force the issue by establishing a predictable schedule for the steady reduction of their support. When an organization is known for being largely dependent on a single donor, this can lead to other donors being reluctant to provide significant support because of the perception that the major patron will always "pick up the tab" as well as the sense that the major patron will also not (intentionally or not)  "share the limelight" with other supporters interested in donor recognition. And development staff can get complacent as well, further exacerbating the situation.

I think the lesson is that if you are the major patron, and you want the organization to survive beyond your support, you need to "own the problem" and be willing to engage in some planning and, if needed, tough love. Or the major patron (and the staff) need to accept that the organization is the creature of that donor, and will exist only as long as they desire it to, and there is nothing wrong with that.