Create new and alternate revenue streams by monetizing the education department at your cultural organization. Not just for community engagement, Aubrey shares three ways the education team could be a source of alternate revenue, as well as examples of artists and organizations already employing this strategy.

Articles mentioned

• Designing a Modern Org Structure

Musicians Monetizing Education

• Nathan Cole (LA Philharmonic)
• Elizabeth Rowe (Boston Symphony)
• Christopher Still (LA Philharmonic)
• Rob Knopper (Metropolitan Opera)

Organizations Monetizing Education

• Richmond Symphony School of Music
• Beth Morrison Projects Producer Academy
• California Symphony Fresh Look

Business Coach on Monetizing Online Education

• Jennifer Rosenfeld

[00:00:53] I'm just blown away that I get to meet this wonderful woman, and the topic we'll be covering together, the three of us, is resilience. So everything Mark and I have to say about resilience and coming out of the pandemic somehow is all off the table when it comes to somebody who's leading their orchestra during a time of war. So follow along on social media if you want to hear more about that, but wow, I just I'm blown away and can't wait to do that session. Later that day at Classical Next, I wrap up my time there with a talk called Epic Fails: Horrible Bosses. 


[00:01:41] And today in this episode, we are hearing questions on organizational structure, how to monetize education within that, and hopefully your ears perked up at that. 


[00:02:01] I'm Aubrey Bergauer, and welcome to my podcast. If we haven't met, I'm known in the arts world for being customer centric, data obsessed, and for growing revenue. The arts are my vehicle to make the change I want to see in this world, like creating places of belonging, pursuing gender and racial equality, developing high performing teams and leaders, and leveraging technology to elevate our work. 


[00:02:37] Maria’s question about why is education under revenue, not product in my latest article on updating our organizational structure?


[00:03:34] Maria, I love that you read my latest article. Love that you were thinking through this, doing it all from Columbia. This is amazing. So for everybody who has not read the article yet, I will link it in the show notes. But what I want to lay out here for the purpose of this conversation is the idea that, in short, I believe the current organizational structure for arts organizations is no longer serving the work that we're doing. And I worked with a consultant at Accenture who does just this, organizational design, and wrote this post outlining a new possible way where we can organize our teams and, mark my word, someday when I'm back leading an organization, I'm going to work with Julian Chender who I wrote the post with, and we're going to do a version of this strategy that I laid out strategy and org structure. So to break it down very quickly for the sake of the question: I grouped the organization instead of siloed departments that we know currently- development, marketing production education, artistic -all of those teams, I broke it down into three main verticals of the organization: revenue, product, and infrastructure. So infrastructure: IT, human resources, that type of thing. Product: everything we put on stage, or if you're a museum, everything you put on the walls at galleries. 


[00:05:19] So I'm so glad you asked this question, Maria, because the answer to this particular question is a big topic that we did not have time or space to get into in the blog post. So you are very right to notice that this is a shift. 


[00:06:32] Alright, education. Traditionally, as many of you all know, education or if we call it community engagement, is not revenue generating. Maybe, I guess in the sense that it's often what we're writing grant applications for or using to pitch to donors. We all know anybody who's done any fundraising, education is always the ticket or often the ticket, I should say. 


[00:07:16] Which is not in full and comprehensive solution to being relevant, to actually engaging our community in which we reside. We call it "community engagement," but, and this gets back to the org structure, there's not one team that handles that for us in my mind. There's not one team that's responsible for making sure we're relevant in the world around us. That is the job of everybody, which going back to the article, that's why that kind of tool or that kind of task is a horizontal slice through all three verticals. It is everybody's job to contribute to how we are relevant in our communities, how we are engaging the community around us. So this is a shift from it's the job of this team, this group of people to no, this is who we are. It's part of our DNA and everybody, no matter who you are in the organization, in some way is contributing to this. Horizontal multiplier is what it's called, the sort of consultant speak on that, according to Julian who I worked with on this. Okay. 


[00:08:30] We can definitely make our educational work profitable. How do we do that? Okay. This is a whole other sort of vocabulary word, dive in here. 


[00:09:00] Originally when Amazon first started, had warehouses separate from their shipping and distribution. They use ups, they use separate storage warehouses. They basically only operated the website in the early days. Over time, they started taking ownership of all of that. They own their warehouses. Now they own their shipping and distribution, or at least a big part of it. We call that Amazon prime. 


[00:10:13] Old school example of this: Carnegie Steel. This was before the term even really existed, but he not only ran the mills that made the steel, but also eventually ran and owned and operated the mines where the iron ore was extracted, the coal mines that supplied the coal. He eventually owned the transportation, meaning the trains and ships that were transporting these raw materials to the mill or to the factory. So you get the idea. Owning more of these things that are normally owned by separate companies. Okay. What on earth does all of this have to do with education, and classical music, and this conversation? Because education is where we can employ this strategy to our gain and benefit. And I don't mean just gain and benefit in terms of profit. We will come back to that, but I also mean gain and benefit in terms of it's a vehicle for serving more patrons. So let's recap where we are so far: serving more patrons, gateway to entry, and making money. Like to me, this is ding, ding, ding. 


[00:11:57] What we have to ask ourself is "what about classical music or what about our arts organization, wherever you work, whatever discipline, is not normally available?" So going back to the definition, the business term would be to say, what part of the supply chain is not normally owned and operated by an orchestra, for example. 


[00:13:07] So how does this play out? Here are some examples of how this is already working in the arts. One area that we can supplement is individual instruction. So think about this. We're talking about the supply chain, what's normally owned and operated by another provider would be individual instruction, private lessons. Okay. I'm not saying we have to do this. Maybe some musicians want to do this. What if we had a revenue share of what I'm about to explain: 50% to them, maybe 50% to the organization. I'm just throwing this out there as an idea of how do we do this. Okay. So here's an example. 


[00:14:21] Imagine what our musicians could achieve if they had the weight of the organization behind them. How many musicians are hustling for students or trying to use teaching as a way to supplement their income? Unless they have a university gig or a college gig, that's really facilitating all that for them, they're on their own for that. So I just feel like this is an opportunity where if our education teams had this as part of their work, Now we're talking about a way to monetize. And there are plenty of adults in the world who would go bananas for this type of instruction with a professional musician in your symphony orchestra. Oh, my gosh. So we have to open up our thinking beyond this traditional model of the students go to university and study with a professional musician. If you're willing to open up the model a little bit, there is money to be made because there is a completely untapped market out there. Okay. Private instruction, not everyone is as entrepreneurial as these musicians doing that. Christopher Still is another one at the LA Phil. Not every musician is that entrepreneurial. We know that. 


[00:15:32] Now I have two more ways education can become revenue generating that I want to tell you about, but first we're going to pause for a second to hear from our sponsor. This is a brand I personally choose to work with and that I know arts organizations can benefit from. 


[00:16:05] And back then, I was lucky to work with several videographers and photographers who brought their own very nice equipment: massive lights, cameras, reflectors, tripods microphones on and on. Today though I am blown away by the tools that are available when we don't have the big budgets to put toward all that gear. 


[00:16:47] They also have ring lights and other video conference lights if you want to improve your zoom set up or your desk set up. All to say, I am a fan. And now I'm an even bigger fan because they are making this podcast possible with their support of creators. And if you want to give LUME cube a try, they're giving you a discount with code AUBREYBERGAUER10. I'll put the link on my website podcast page and show notes as well. Thank you to Lume Cube for supporting the business side of the arts. I'm super grateful. 


[00:18:02] The other option adults have, if they want to learn more about classical music, is to attend some sort of continuing ed program. This goes right back to higher education, continuing education. Offered by these schools. Now I didn't realize this at the time, but we have proof of concept of this back at the California Symphony. So what we started was this idea of adult education. We knew that there was this gap. We had uncovered from all of our Orchestra X research, this gap in knowledge because public schools aren't teaching the music education the way they used to decades ago. And we knew from our research that people wanted to learn, but there wasn't really an opportunity for that. Outside of, like I said, higher ed or something like that, or the pre-concert talk. So we said, what if we offer adult education? At the time, we weren't really thinking about how to make it profitable. But since I've left they've really upped their game. I'm so proud of them and just really interested in and inspired by what they've done here. So to lay it out, the original class structure we developed was four weeks at $25 each. So the first year we ran this, I can't remember what year that was. Maybe 2017. I can't remember. We sold out. The room we had at the local library was 75 people. Sold out. Most of those people were new. Had only been to California Symphony zero or once before ever. Almost all of them. So we were capturing the group we wanted, meaning not aficionados, sold it out. Were able to convert those people to ticket buyers. Next year, the library let us get a bigger room. Their largest room fit a hundred people. We sold it out again. By that time, the curriculum was already developed. This was in-person. It was all pre pandemic. So both of those iterations of the course ended up with something like $10,000 in new ticket sales. 


[00:20:15] If they kept that price, that's $7,500 for one class at a dirt cheap price. And as a reminder, all of the curriculum was already developed. All the collateral was already developed, three years ago, I think, at that point. So they made that with very little effort; so fascinating to me. So that went well. And so then they were doing it again, the following, like February or March, I think. So spring of 2021 at this point. Now they had it with prerecorded content they captured the summer before. So every iteration of this kept getting easier and easier . 


[00:20:58] That is high profit margin. And that is the point of all of this: that we can get to a point where we are educating people, providing a service, they are paying for that service because they want that education in their life because we are providing something that the market is not really offering otherwise. 


[00:21:35] There are a few other orchestras that I know that were doing that. Richmond Symphony had a full slate of virtual education they rolled out during the pandemic. 


[00:21:56] And the third example I want to talk about is professional development and arts administration training. We know that the training we get as administrators is not the same as the training our artists get for the work they do, in terms of it's not as intense, it's not as robust. We only now have, in the last, what, 10 years or 15 years or so, these masters of arts administration programs, this is rising. This is good that these programs exist now, but it's still fledgling compared to the rigor of the training our professional artists receive. So this is also an area of opportunity for us. And an awesome example of who's done this already is Beth Morrison Projects. So Beth Morrison Projects, they are a opera, musical theater maybe, organization based in New York. They are known for bringing new works to the stage, and they created during the pandemic what they called their Producers Academy. They created online courses, and they were like one week intensives, I think. How do you bring a work to stage from commission to production? How do you do the fundraising necessary? How do you do the budgeting necessary? What does touring look like for an organization? All of these things that are so necessary in terms of skill development for our field. Currently they're only taught if you do get one of those master's in arts administration/ master's in arts management credentials. So again, filling in a void completely. And I forget their first run of that program, I think they made $80,000 or something like that was the stat I heard. So not bad. Any organization of any size would not sneeze at $80,000. And that was their first debut out of the gate. 


[00:23:56] And total plug here. I'm bringing her in for my panel at the League of American Orchestras conference in early June to talk about this topic more. So total kudos to Jennifer. If you want to hear more, she's going to be talking about it, but she says this: she says online education is about creating high profit margin. 


[00:24:31] Online education completely flips that. Getting access to adult education is not readily available. There is a market for this and a hunger for this, and it is so much cheaper, meaning less expense on the P & L to produce for such a higher return. 


[00:25:13] Thanks for the question, Maria. 



[00:25:37] So I've been thinking about this a lot, and I decided to create an opportunity to address this. It's a group coaching course called the Summer Uplevel. We're meeting four weeks this summer, twice a week, first on Monday evenings to cover topics like managing up to your boss or a board, how to stand out in job applications, and getting buy in for your ideas. And then there's a second meeting later each week to get coaching around those topics or other topics you want to make sure we cover. 


[00:26:24] You'll also get a one-on-one session with me so that we can really dive into your specific situation, your goals, and strategize how you can get there. 


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