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As I read this article, I remember how much harder it felt to build up financial cushion when I ran a $3M museum than when it was $700k (when I started).
When I started, we had a theoretical budget of $800k. But we were completely broke. All... https://twitter.com/ZacharyHSmall/status/1245742717033947137
When I started, we had a theoretical budget of $800k. But we were completely broke. All... https://twitter.com/ZacharyHSmall/status/1245742717033947137
our cash had been depleted. We had less than a week of cash to spend. I made hard cuts immediately, so we could start getting in the black day by day, then week by week. We even made a ridiculous fundraising push based on these two cheap bottles of prosecco...
labeled $50k and $100k (see ridiculous video here: )
It was INTENSE and TOUGH for months. But we built up cash in the bank and we all went back to full salaries. By the end of the first year, we were well in the black and building an operating reserve.
It was INTENSE and TOUGH for months. But we built up cash in the bank and we all went back to full salaries. By the end of the first year, we were well in the black and building an operating reserve.
Our target (based on @nff_news recommendations) was to build a reserve equivalent to 3 months of cash. By year 2, we had a budget of about $1M and $250k of cash in the bank. It was "working."
We kept growing. The bigger the budget grew, the more sources of income we had. But...
We kept growing. The bigger the budget grew, the more sources of income we had. But...
It was hard to keep building a reserve that matched the size of our org. The reserve kept growing, but lagged. We hit a $2M budget before we hit a $500k reserve. We hit that reserve level - and then we also hit a $3M budget. To be clear - we always OPERATED in the black, but...
We weren't building up a way bigger reserve to match the size of our operation.
Now I wonder if orgs will start questioning whether 3 months in the bank is "enough." It's really, really hard to prioritize building reserves when you want to pay staff more and do cool stuff.
Now I wonder if orgs will start questioning whether 3 months in the bank is "enough." It's really, really hard to prioritize building reserves when you want to pay staff more and do cool stuff.
This thread inspired by @HistoryGonWrong, whose clear posts about museum leadership and finances have been a gift to me and so many others in the past couple weeks.
