“What’d I ever have achieved in the cheese business, I’d like to know, if I’d said that money wasn’t important?”
Salzella smiled humorlessly. “There are people out on the stage right now, sir,” he said, “who’d say that you would probably have made better cheeses.” He sighed, and leaned over the desk. “You see,” he said, “cheese does make money. And opera doesn’t. Opera’s what you spend money on.”
- Terry Pratchett, Maskerade
Art has always sucked at economics to one degree or another. The false binary solution set of fulfilled passion vs comfortable lifestyle enablement has stymied hundreds of thousands over the years. But theater before 2020 was its own hive of scum and villainy. In this part, I'll be addressing both regional theaters (by which I mean outside NYC, averaging 200-400 seats) and individual artists. (Broadway will be addressed in part 3)
Before 2020, regional theaters survived on a hodgepodge of ticket sales, patronage, and good old fashioned bullshit. In reading an article about ten years ago, it seemed such theaters only earned about 50-60% of their annual revenue from selling their actual product: tickets, subscriptions, merch, what have you.
Half. Half of their revenue. This is why theater had so many whiners about capitalism infesting their ranks, they sucked at it. A business model that only earned half its operating income would have rated a D at best in Business 101.
What covered the other 40-50%, you ask? Grants and sponsorships, most of it. Local, State, and Federal arts funding, may the best grant application win. Local businesses and wealthy individuals and their foundations and endowments. In some cases, tax deductions made the difference. In others, the prestige of patronage.
Patronage itself is nothing new. The wealthy have always commissioned artists one way or another. Beowulf was first performed over a series of nights, entertaining some dark ages lord and his retinue who fed and housed the composer for the winter. Acting companies in Shakespeare's day were as sponsored as any NASCAR team. What American regional theaters were good at was hiding the extent of that from the hoi polloi. Including the actual performers.
Oh, if you were a regular audience member, you eventually wound up on one email list or another. Fundraising drives have been an American take on passing the hat since before the telethon. But all they ever mentioned was that year's goal, how close they were, and what perks your participation got you. Normally, a note in a program, on the wall of the lobby, or both.
What you weren't told was exactly how and of what the sausage was made. It's not impressive to point out that your cast and crew were paid peanuts if they didn't have a union pointing a gun to the producer's head. The typical line of bullshit was "economic impact." Ignoring how much individuals were actually paid and instead pointing out how much audience members spent in the surrounding community.
Why all this bullshit if the actors STILL weren't getting paid beans?
My best guess is to keep ticket prices low enough to attract a maximum audience. Sometimes this is done for altruistic reasons (wanting to bring art into lower-income communities). But more likely, because there are diminishing returns once your prices rise above a certain amount. Sometimes the difference between twenty dollar tickets and thirty dollar tickets was the ability to sell all of them instead of half, or three-quarters, or what have you.
However, doing this meant that the box office didn't make the company's nut.
(Nut. n. Circus term for earning enough in performances to cover the bills. Town sheriffs used to confiscate the nut securing the axle to the main circus wagon to prevent them from leaving town in the middle of the night without paying their bills. Hence, making the nut means to pay off your expenses)
Thus, theaters needed to find alternate revenue streams of patronage. While this alternate revenue sucked at making its way to the cast, it did keep the theaters running, for whatever that was worth.
Why keep paying the actors peanuts if they were operational even only earning half of the income they needed?
Because they could. Plain and simple.
Because acting has always been oversupplied and under-demanded. And there are always actors willing to act for peanuts more than they are willing to not act for nothing. To a ridiculous level in some cases (looking at you, Los Angeles and your 99-seat bullshit.)
Strangely, a lot of actors would scream all day about McDonald's and Walmart paying this mythical thing called a living wage. Yet none of them would dream of demanding such a thing of their own producers. Funny, that.
But that's the past, and the past is dead. And so, I think, is patronage. And grants.
Federal, state, and local budgets have been HAMMERED by Covid. Their tax bases have shrank and their services have been overrun. And while the Fed's budget is bad enough, they're not as bad as state and local governments, which can and do go bankrupt.
Which means regional theaters that survive are going to have to go with their own box offices.
Quick math: 200 seats, twenty bucks a ticket, what's your maximum nightly haul at the box office? Don't look at your phone, do it in your head!
Five, four, three, two, aaaand one.
If you got something besides $4000, go work on your arithmetic. This post will still be here when you get back. (Quick hint, to multiply by 20, add a zero to the end, then double the result. It'll only get more complicated when we add .95's to everything).
From there, start thinking about the nut. What's it cost for rent on the building? Utilities? Insurance? Taxes? The company staff? I've never fed an artistic director, but I heard they like eating too.
Take half a month's max box office and subtract two months of nut. That accounts for you selling half size houses on average for the course of a run and rehearse for a month without earning a dime but still having to pay everything.
If you have a positive number, you might have a viable company and production on your hands.
If you don't, you need to change those numbers until you do.
Remember: we are all in survival mode here. Neither landlords nor greengrocers accept exposure. If you want to earn your living doing your art, you need to make money with it. Period fucking dot.
I realize this model can and will devastate the vast majority of regional theaters in this country.
I realize this is going to destroy the life’s work of a lot of people I respect and admire.
And it brings me no joy to say this.
It is also the only way I see any of those surviving.
Right now, theaters around the country are patting themselves on the back with how diverse their initiatives are. Funny how they only got around to all that now that they don't have any fucking theater to do. Years late and five figures short, but it keeps them in the woke hashtags, I suppose.
What they need to be doing is seeing exactly how far beyond "four boards, four trestles, two actors and a passion" they can get and still keep the lights on.
Maybe we're due for a vaudeville revival, as non-Broadway theater cozies up to burlesque and standup when audiences actually become a thing again.
I definitely think what comes will be smaller, more intimate, and with less spectacle.
That said, I think there are a very few things that may become a net positive.
Commercial real estate values are going to drop heavily. Teleworking means a lot of major companies aren't going to bother with claustrophobic and costly office space downtown anymore. Fewer clusters of white-collar workers means less services tailored to them, particularly restaurants, which are experiencing their own devastation.
This means that spaces easily convertible into 200-400 seat houses will become cheaper in at least the short run.
The smaller spaces allow for lighter technical expenses as well. A house that small can be serviced by a surround sound setup designed for some rich yahoo's living room easily enough, as opposed to a setup designed from the beginning for a commercial theater.
And I think the necessity of earning the nut entirely at the box office will solve a problem theater's been working at cross purposes for decades now.
I see far too many artists of all stripes favoring their message over their audience. They want the unenlightened wealthy to pack the house night after night, paying for the privilege of being told what pieces of shit they've been and how they need to fix themselves.
And when they can't find audiences or even producers, they piss and moan that their message is lost.
Oh honey, no.
If you want rich and unenlightened to pay you for the privilege of telling them what awful people they are, get out of theater and become a dominatrix. The pay's much better and more honest. But even then you have to pay attention, because they're paying you to tell them how THEY think what kind of awful people they are.
Or, get yourself a small enough space, maybe you can draw a crowd that learns and believes what you have to say. A simple room and a big idea can be done right, TED talks have proved that.
But survival comes first. Got to earn your nut. Figure out what it takes to keep you running weekly, monthly, annually. That's your nut, and you should know it.
That goes for individuals and it goes for companies.
Go earn your nut.
If you still need to ease your brain into this terrifyingly capitalistic frame of reference, I heavily recommend the book Make Art Make Money by Elizabeth Hyde Stevens. It's an examination of the career of Jim Henson through both artistic and business lenses, and I think it should be required reading for anyone even considering an arts career.