Deliberately Unsustainable Business Models

I once asked Eric Siegel, the Director of the New York Hall of Science, why museums are rarely innovative shining stars on the cutting edge of culture. He commented that as non-profits, "museums are built to survive, not to succeed."  Unlike startups and rock stars, museums aren't structured to shoot for the moon and burn up trying. They're made to plod along. Maybe it's time to change that.

Last year, I met Mark Allen, the founder of Machine Project, an extremely cool "post-educational" space in Los Angeles that is part art gallery, part workshop space, part mad scientist party central. They host events like Dorkbake in which people design their own Easybake-esque ovens and then bake cakes in them. Next month, the space is being turned into a magic forest. Their mission statement is: "Machine Project exists to encourage heroic experiments of the gracefully over-ambitious."

At one point, Mark commented that they have a "deliberately unsustainable" business model. In other words: do great stuff while you can, and when you can't do it anymore, stop. This is the model that governs most businesses and artistic endeavors. It's the reason terms like "jump the shark" exist. Most companies, rock bands, and sports teams are only brilliant for so long. Then they start to slide. Then they die.

Of course, the current financial crisis demonstrates what happens when companies set up artificial life support systems to prolong themselves far beyond their ability to provide great products and services. The unusual part of Mark's statement isn't the acknowledgment that Machine Project will only exist as long as it is relevant and good; it's the desire to close up shop when the excellence ends. It's incredibly rare for an organization or company to seek deliberate unsustainability. Most want to provide consistent jobs for their employees so their families can be secure. They want to provide quality products that are reliable over the long run. They want to promise consistent services that consumers can bank on. That's why TV shows jump the shark. When they can, they will claw their way through as many seasons as possible.

The problem arises when the desire to sustain overcomes the desire to be awesome and more resources go to surviving than succeeding. This is abundantly clear in the case of US automakers and banks, whose current arguments for financial support rest on their need to survive, not their ability to succeed. Is it true of your museum too?

For some museums, awesomeness has never been part of the mission statement or core services. Elizabeth Merritt from AAM wrote a provocative post last week about the financial future of museums in which she suggests, among other things, that 20% of museums should be allowed to fail in the coming decades. As she puts it:

My observation, after thirty years of working in the field, is that museums have an amazing ability to survive in the most adverse environments. They are the cockroaches of the nonprofit world--sometimes it really does seem like you can’t kill them with an atomic blast. Most of the time some improbable deus ex machina saves the day: for example an unexpected cash gift or a free building. Mind you, this often only saves the distressed museum from closure—it does not cure the underlying dysfunction. The museum may simply struggle along for another ten years before the next potentially fatal crisis.

The underlying dysfunction that Elizabeth mentions is often an inability to focus on anything but survivability. To make it, museums need to survive AND succeed. I think it's important for museums to undergo an exercise in which you list out two types of things:

1. core services that people depend on and need to survive. These include jobs for employees and programs that address a societal gap not provided by other organizations or businesses. For example, maybe your museum provides job training for at-risk youth and your community relies on your consistent ability to do so.
2. services you provide that make you awesome. What drives people through your door, gets them excited, and connects them passionately with your content?

You should be able to point with pride to both the ways you support the community with reliable, consistent services and supreme awesomeness. The desire to survive will always exist, whether you run a small institution or a giant one. It's human nature to want to keep your job and keep doing what you're doing. The challenge is not to make it your primary goal.