Capacity Building: Entrusting Arts Orgs to Bring Themselves to the Next Level

Lonnie Firestone

Editor’s note: This week’s piece is part of our series on philanthropic strategies that elevate the world of arts and culture. We encourage you to add to the conversation with comments and suggestions.

At the Double Edge Theatre in Ashfield, Massachusetts, every production draws on the collaborative talents of the company’s ensemble. 

“It’s the best way to create art,” says Founder and Artistic Director Stacy Klein. With an ensemble, “you build your craft over time. You also create a cultural life in your community.”

Yet overseeing a company of actors can create obstacles to artistic funding. Some foundations prefer to support programs and productions, which can leave the ensemble and staff uncompensated. In some scenarios, grants are funder-driven and not intrinsically related to the mission of an organization; alternatively, they might not cover the full cost of a specific project.  

Unrestricted operating support — meaning, funding that entrusts the organization to determine how to best apply the funds — has been a game-changer for Double Edge Theatre, one of 29 organizations in Massachusetts selected to participate in the Barr-Klarman Massachusetts Arts Initiative (BKMAI). Organizations in this six-year initiative receive multiyear unrestricted operating grants coupled with capacity-building support for board and staff leadership (including individualized coaching, technical assistance, and cohort learning opportunities with expert trainers focused on building financial health and financial sustainability).

The initiative builds off The Barr-Klarman Arts Capacity Building Initiative, a prior partnership between the Barr Foundation and The Klarman Family Foundation to support and enhance arts and culture organizations in Greater Boston.

Klein recognizes the centrality of the BKMAI to the Double Edge Theatre’s ability to support its own artists. “The majority of our operational money has come from Barr-Klarman,” Klein says. “Because it’s operational money, we can raise the ensemble’s salaries. That was major for us.” 

Across nonprofit organizations, there is a widespread desire to spend less time fundraising and more time creating. And in many instances, the philanthropic community has responded by listening more closely to organizations’ needs. 

One approach that has proved formative for the BKMAI has been capacity building, which the National Council of Nonprofits defines as “whatever is needed to bring a nonprofit to the next level of operational, programmatic, financial, or organizational maturity, so it may more effectively and efficiently advance its mission into the future.” 

SueEllen Kroll, Senior Program Officer of Arts & Creativity at the Barr Foundation, explained the idea further on the Barr Foundation website:

“We designed the Barr-Klarman Arts Capacity Building Initiative based on the belief that when arts and cultural organizations are adequately capitalized with a healthy business model, they can build reserves that let them stay bold, experiment, and weather uncertainty.”

Malka Travaglini, Senior Program Officer at The Klarman Family Foundation, explains the strategy: “When you help strengthen organizations through general operating support, and you include the board and help them understand the organizations’ financials and how the financials relate to the mission, then organizations are better positioned to thrive and be innovative. That was the key learning from the prior cohort.”

Kroll adds, “I really love our approach in this capacity-building program, which is that every organization sets its own goals, and we customize it to every grantee. We’re not going to say that success for each organization is growing their budget by 30%. Every organization is different, so the individualized approach is really important.” 

Frederick J. Isaac, founder of the Isaac Fund, believes similarly that foundations should listen to organizations’ ideas and respond to each nonprofit’s unique needs. 

Isaac prefers the term “infrastructure grants” to refer to his process of grant-making. He reaches out to organizations, invites them to apply for a grant, and meets with each organization’s members to discuss their mission and core objectives. Two such questions are, “What is your biggest organizational challenge?” and “Given additional resources, how would you begin to think about tackling this challenge?” 

Isaac then invites the organization to submit up to three proposals, one of which is selected for a grant. While the Isaac Fund does not offer unrestricted grants, it develops a trusting relationship with organizations so that each can decisively strategize, request funding, and achieve a central goal. 

“I want to make sure that you do what you do better, as you see it,” Isaac says. “I’m not interested in finding out how big you can get as a grantee; I’m making sure you have what you need to do what you already do.” In other words, Isaac cultivates an opportunity for grantees “to provide their own vision,” he says. 

The Isaac Fund supports organizations and projects in the Bay Area of California, across the US, and in Israel. His grantees include such wide-ranging organizations as KlezCalifornia, the Jews of Color Initiative, and IsraAID.

“I try not to limit myself in terms of what comes in the door,” he says. “I try to remain curious, to stay alive to the possibility that there’s something out there that I haven’t seen that will fascinate me.” 

Both the BKMAI and the Isaac Fund have been especially attentive to organizations amidst the pandemic, which has been devastating to the arts and culture sector — in July 2021, Americans for the Arts reported that financial losses to nonprofit arts and culture organizations have approached $18 billion. In the past year, the Isaac Fund responded with $219,999 in unrestricted funds to help its grantees stay focused on their work.

Kroll recalls that when the pandemic hit, the foundations had to be “nimble and responsive” to the needs of the organizations they fund. “We pivoted our planned learning curriculum to meet emergent needs, such as creating trainings on unemployment law, scenario planning, and cash flow analysis,” she says. “We also provided unrestricted emergency relief grants to help bridge cash flow needs before public relief funds, such as the Payroll Protection Program, were distributed.”  

Klein says that the support and trust of the BKMAI has been instrumental in helping The Double Edge Theatre thrive. 

“It was three things,” Klein says. “First, community – they really supported us at a hard time. Second, we performed last summer, and it was inspiring to people that we were able to do it. And third, we started working with Barr-Klarman. It helped us see that if we could build our capacity, we could do everything.”

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