OK, well, every council is going to be different. We’re a capital city council so we provide funding for our local community, which are our residents and ratepayers, community organisations. But we also provide funding for major events and activities that happen in the City. Most local councils obviously would just provide funding and grants for their local community activities because we are a local council and that is our key role. But when you’re a City council you also need to look at the bigger picture.

Is there anything specific about the Sydney Local Government Area (LGA) that is different from other metropolitan LGAs or regionals?

Yeah, definitely, the key thing that is different are the major events and activites that happen in the City of Sydney. We are the events site for say Sydney Festival, Writers Festival, the Biennale. That’s saying that everybody recognises in a capital City, and that’s something the City invests in heavily because it is a point of distinction for us.

There’s a distinction between your sponsorship and your grants. Now what types of funding do you offer other than grants?

OK, we give grants and sponsorship as you said. Grants we recognise as cash support to somebody, we don’t expect anything in return. A sponsorship, like any sponsorship, you get equal value back in return. That can be in the form of advertising and promotion as usually the case. We have 16 grants programs. Some of those are cash programs, some provide accommodation for offices and businesses, some provide use of our banner poles, and some provide use of our venues or our parks. Though we have a package of things we can offer people.

Now, as a percentage of money that you give out, what goes towards sponsorship and what goes towards grants?

It’d probably be about 50/50.

Really?

It’s different each year, depending on which organisations have applied obviously

What type of applicants do you usually get for grants?

That’s predominantly local community groups. From local history groups to disability groups, people working with the aged and community services. Particularly once they are relevant to the City of Sydney, a lot of the homelessness services, people living with HIV/AIDS, things which match what a City profile is.

What effect do your grants have on those who apply? What have you gotten back, and how have you seen the City change due to the grants you hand out?

Sure, that’s a really good question. That’s always a hard thing to measure. But we know, for a start, projects happen. The Writers Festival is a good example, I was just speaking to them then, the Writers Festival probably wouldn’t be able to happen without our support. With the exception of the major festivals, the money we provide is just for one-off projects. So if we don’t give it, that one-off project doesn’t happen. So we do see things occur simply because we’ve given money. We like to think that because of things we invest in, we are a more culturally rich City. So the arts and culture are vibrant and interesting. And also a lot of projects and programs are working with people in our community, particularly people who are disadvantaged, which wouldn’t occur otherwise. So that’s things like research into homelessness services, the provision of office accommodation for community groups, so really it’s a whole package of things.

What do you fund that is “identifiably Sydney”?

Ah, Mardi Gras. The one I can answer to you like that. That is 100% Sydney that we funded.

Although there are other parades, like in Melbourne there’s Midsummer.

The Gay and Lesbian Mardi Gras is unique around the world. An event of that style and that size. So that’s very Sydney.

How does the City indentify and relate with something like the Mardi Gras?

With Mardi Gras, we’ve been onside right from the start. As it happens in the City of Sydney, it happens on our land. Up to the last year or so, we’ve been the only government sponsor, so we’ve been very heavily invested with them. We don’t see our relationship as just giving money. We work with them to help improve their event and support them. We have an ongoing relationship. So I would meet with Mardi Gras once every couple of months, so do my staff and colleagues. We don’t just hand the check over and walk away, we try to get involved and add lots of support where we can through our expertise and skills, or networking with all our events and organisations we fund.

What do you ultimately want to see grants do for the City?

A few things I guess, there isn’t just one thing. We want to see is help empower people in the City ot take action and responsibility, and develop the community themselves. We invest a little bit, the community gives a little bit as well, and that way the whole of the City grows.

How do you see that they help build their own community?

That’s exactly what we are looking for out of a lot of the grants. We are asking in a lot of grants for the community to match what we are giving. So we give say $5000, we expect them to match $5000 in volunteer labour. So we actually look at them as community development projects. I guess that’s probably the overall outcome we want, we want a better community. If the City is doing everything, then is not sustainable. You’ve got to invest to make things happen and, then you got to embed to keep things happening.

What would be an example of a group who then helped build their community? What have you seen over the period of time?

Off the top of my head, it’s hard to answer. Our community garden projects, we just funded a lot of those, and they’re just starting, so I can’t tell you one that’s ended yet. But that’s where we put the upfront cash to make them happen, but the community has to keep them going or else they don’t exist anymore. We funded a really good project a while ago, that was to do with working on the heritage boats in the harbour. It was a program where youth could go and work on these boats, but work towards a TAFE certificate. That project then got investment from the heritage boat owners, local business and TAFE and we funded it for three years. We don’t need to fund it anymore because we’ve invested enough to make it sustainable, and it’s now business, TAFE and the community who are putting in to run the project. I could give you hundreds. That’s the type of thing we look for with our projects.

Often I hear people say that they were not included in the process and preference was given to others. What are the factors that help you choose?

Ah OK, firstly to say, we always get more grant applications than we can pass. So there’s always going to be good projects we can’t fund. So that’s the first reality, we can only fund what we have money for. The second thing is, we look to fund projects that can benefit people who live in the City of Sydney. It’s simple but people forget: it’s our residents and ratepayers who have paid money to invest these grants. Unless our residents get something back, we’re not going to invest money in it. And that’s pretty blatant. We look for things that align with projects the City wants to do as well, such as community gardens. Cultural and community recognition in the aboriginal community is a really big project for us. What we knock out are things that aren’t sustainable, don’t benefit the City’s community, and have budgets that don’t add up. I mean, if you work in grants, you know what that is like. But generally what we do is look for things that support us, rather than knock other things out, if that makes sense.

What percent out of the number of applications you get, meet or to say do not meet the criteria?

Look, probably two thirds meet the grants criteria, but we’re only ever able to fund a third. So, you know, the reality is, even if you meet all of the criteria, there maybe another project that gets funding other than yours. We also try to create a balance across the City of Sydney. So not all of our projects are in Kings Cross or all in Glebe. Sometimes people miss out just for that reason. In the cultural area, we try and fund across art forms. So we don’t have 60 poetry projects. So it’s always a bit of a balance.

What’s the best type of application you’ve received? What has stood out?

First, budgets add up. That’s a big one for us, because we need to know our money is going somewhere adequately.

It is filled out to a proper accounting system, or there’s thought put into it?

Thought put into it. We’ve got a kind of funding template people can fill out. We make it as simple as we can. But a lot of people don’t realise the basic thing that your income needs to match your expenditure. Now to me, if you can’t figure that out, you can’t run a project. So we look for things like projects that are clearly written that make sense. I can’t tell you how many applications we get that don’t tell us when and where they are doing a project. And then of course, those who thought about what the City might be interested in. So have they had a look at what our priorities are? Have they spoken to one of my staff about the project? So, have they made an attempt to think about the fact that we are a funding agency, and therefore we have priorities as well.

Is there a difference between first time applicants and those who applied before?

No no. You get first time applications that are fantastic, and you get people we speak to every single year about their application and it still doesn’t improve.

That’s interesting. Any other typical mistakes made in applications?

The two big ones are budget and not remembering that we don’t know every single thing about your project. You may know you are planning to run it in Jubilee Park in Glebe, but unless you tell us that in the application form we don’t know. And that’s a fatal flaw to forget we don’t know everything.

How does funding from State Government affect funding?

We love to see people getting funding from other organisations as well, because that means we’re not the only funder. And the reality is local government has no responsibility to provide grants. It’s something we do optionally, so we don’t like to see people solely relying on City of Sydney funding because we’re not obliged to do it, and we may decide not to do it. That’s obviously not going to be the case with this council, it’s incredibly supportive, but councils change so people need to realise that we’re not necessarily always going to provide money. So we love to see other forms of support coming in. I speak to my state government counterparts, and to some extent our federal people. We all work together.

Does the way in which the state government funds the actual council then …

Councils generate their own income, but there are times of course where we’re making more or less money, and if the councils aren’t in a great financial position, it’s obviously not going to give grants, are they. That’s an extra cost. At the moment, City of Sydney is in a very sustainable economic position. We have a Lord Mayor, Clover Moore, who is very supportive of community, so we’re able to give a lot of grant money. But if we were running out of money ourselves, obviously the first thing to go is something we don’t need to do. And our ratepayers would rather us invest it in parks and picking up their rubbish, than invest in grants. Other councils in the past have been very interested in ‘the high arts’. And that’s where they would fund, and that’s each councils’ right to decide. Because the public have voted them in on those priorities.

When people ring up, what are the standard questions they ask?

Where do I get an application form from? When do the grants close? And then they ask about what are our priorities for funding? Which is reasonable enough. While our grants are open, we meet with people and talk to them about their application, so we try to be very open about it as well. We’d rather them put in a good application, than knock themselves out.

Let’s briefly come to the sponsorship side. Do you view them differently to grants?

No, pretty much the same. It’s all the same unit. The only difference in sponsorships is that the City invests in them to some extent, because we get the benefits back. It’s not just for goodwill. So, we might invest in a festival for instance, because we know we will get publicity about City projects through doing that. But that’s different criteria we will put in their funding agreement. We treat them the same, if that makes sense, in terms of our relationships.

What documents do you usually recommend for applicants to read?

From our perspective, we ask them to read Sustainable City 2030, which is our blueprint for the future. Depending on which grant form they are applying for, they might look at the social plan or the local action plan. So it’s different depending on which they apply for. But basically, we suggest they look at the relevant City policy or plan, so they have a sense of what to look at.

Do people do that?

Ah, the good ones do. And of course, as I said before, ones the align to what we’re looking for are more likely to get funding. So yeah.

So it sounds like those who put the energy and time into it stand more of chance of success.

Absolutely right Eric. Of course, they’ll always end up doing more.

Finally, do you have any further funding advice or tips?

I think, remember that there are lots of priorities for people, so your project may not get funded, but it doesn’t necessarily mean it’s a bad project or organisations don’t respect your work, it might just mean it’s not a priority for that year, and people sometimes take it a bit too personally. I think it’s also remembering it’s not just cash. But our staff can help give you advice on your project, or can put you in touch with people or they can put your flyers in our libraries. There’s numerous other things we can do. So it’s always worth staying in touch with people all the time, not just for the money. Because we see ourselves as giving more than that. I think people get very focused. Of course, you want money for project, but they get very focused on that and forget that you can have a very good and strong relationship with us, without necessarily just getting cash, and we’re really supportive of ways that are not just cash. That’s probably my number one tip.

Thank you for the interview!

Great questions Eric! I hope you get some great information out of this

Hi James

G’day Eric!

What got you to wanting to do this?

I moved to Sydney eight years ago from South Australia, and South Australia is a very resourced state, and it’s got a very strong indie culture and lots of support for it. So coming to Sydney to the exact opposite, it was the understanding that lots of people bang on about trying to better the situation, but a lot of people don’t do it, so it was basically myself and Samantha Chester going “OK, let’s stop talking about it, let’s see if we can do something about it”, and that’s how we started the first studio Queen Street Studios (QSS) four years ago.

How’s the ride been with QSS? From conception to now, how would you say it’s gone?

Yeah, well, its a been a massive learning curve. We didn’t know anything about small business prior to starting it, it was an intuitive journey. Hell of a lot of work, hell of a lot of volunteer hours, but when you’ve got a vision and you ask people to join in, people do join in and get a lot of support. We were told by our solicitors, as part of signing up a Development Application that you need a solicitor to sign, that our business idea would be bankrupt in three months. But we’ve been now trading for four and a bit years now, so she was wrong.

But the thing is that people really undermine independent artists as a potential market. But in actual fact, it’s a very under-resourced market, and if the service is real, people will come and use your service.

What do you mean by under-resourced?

It’s kind of in Sydney, particularly, it’s a very commercially driven economy, and so I guess we equate markets with volume and the amount of money people have. So we immediately write off arts, artists and independent artists as being poor when in actual fact they are entrepreneurial, very active and supportive of ideas that assist them to propel their careers, ideas of projects. So I guess by under-resourced, there are no facilities for an independent artist to be able to work, for it to be a good economic decision for them. So that’s why we did QSS and we set rates that are incredibly subsidised, so that effectively an artist can rehearse work for around $14/hr as opposed to the standard $30/40 an hour.

You would guess that if artists can afford $14/hr but not $30/hr, then there is something within their budgets that doesn’t allow that. Are budgets tight that artists cannot afford $30/hr?

Yes they are, and also the rates of financial subsidies through grants are extremely low here in Sydney. Of course an independent artist has to compete against major international touring and significant Australian organisations like Sydney Chamber Orchestra and Symphony Orchestra, the Australian Ballet, Sydney Opera House. So when you apply for a arts grant, you’re essentially competing against them.

Which artists do you end up helping?

We assist anyone who is kind of considered as an independent. Quite often they are self-funding, or they got a small grant from somewhere. The reason why a small artist finds it difficult to spend $30 on a rehearsal space, is because quite often they are doing an activitiy that isn’t generating income for that time that they are using. They are developing a concept. They receive their income either at the start in the form of a grant, or at the end as a form of box office. But cashflow for them is a key issue. For them to invest in themselves, and develop an idea that will eventually get box office, they need to do a significant amount of outlay.

Quite often ideas fail, and that’s the idea of ideas I guess. It’s kind of a tight situation because of that.

You’ve probably just touched on it, but why doesn’t income come so easily to artists?

Because they don’t have the capacity to have, lets say, for want of a better term, products on a mass scale. So let’s say, for a visual artist, they have a body of work, but because it’s not mass produced, it can’t be constantly on sale.

They don’t have economies of scale…

Yes, they don’t have economies of scale, similar to performing artists. They work on anything from three to twelve months on an idea that will eventually get an idea to stage. But they cant afford to have long seasons in venues, because you pay $10,000 a week for a venue. And you gotta outlay that before a show, so that only gives them a window of eight performances in which they can return the expenditure. Quite often it only breaks even.

If they are showing art-based performances, people love art, people love to see it, surely they would get ticket sales, and that would cover their costs and probably make a profit?

Yeah, but there’s a couple of issues in regard to that. One is that in fact, the average Joe in the mainstream really doesn’t have access to what’s on. A lot of stuff happens, but happens in house, or it’s via membership or a newsletter. A lot of presenting bodies don’t really have a lot of marketing nous or ability to get information out there. So that’s an issue.

Another one is that Sydney is a culture that doesn’t appreciate the arts or in particular, independent arts very strongly. Unlike Melbourne, where a mainstream office person has within their schedule of entertainment, probably, an exhibition and a theatre show activity after hours. Sydney is based pretty much around the pub or the club, or dinner at mates. We don’t have an independent culture here in Sydney, so the independent producer suffers quite significantly, because he doesn’t have the critical mass.

You were talking earlier about partnerships. Who have you partnered with?

Well, for Queen Street Studios, we are currently partnering with Frasers Property Australia. Alongside that we have Capital Group, that slate of partnerships, and they’re a PR company. In the past in my independent work, I’ve partnered with Volkswagen, King Gee, Internode; on a couple of corporate bodies I’ve done work with Qantas. I’ve done festivals that have had significant partners as well, I’ve don’t a lot of partnering with local government. We do community festivals here in Chippendale for QSS, which we partner with local galleries, and some commercial business. And my Company B work partners with Freehills Lawyers.

That’s an interesting mix. A couple of streams there. Government, private businesses and community. What are the differences between those three types of organisations? How was it dealing with each of them?

I guess each of those have different expectations and different levels of partnering.

Were they sponsorships?

They all call them sponsorships now. Because it’s a term that gives a lot more value back to the sponsor. A partner gives a sense of it being a lot more even. Though I think what needs to happen is that people have got to realise that funding, sponsorship and partnerships are liabilities. They’re not cash in the bank, they are attached to some very significant contractual agreements.

What source of agreements?

In regard to when things are delivered, what things are going to be spent on, how it returns benefit to the partner or the sponsor. Quality assurance. It doesn’t give freedom as such.

What do sponsors or partners want to see come out of their sponsorship or partnerships?

PR.

What type of PR?

It could be about corporate responsibility, it could be about accessing a niche market, or addressing a current concern within their market, like fixing up a couple of things by doing something that is charitable to some degree. But it is inherently capitalist, it will never be philanthropic. Even with philanthropy, it is capitalist in the sense that the philanthropist receives a tax benefit for the investment. So nobody is getting anything for free, and noone is not paying for a service. So it’s a sneaky way of getting something achieved.

But no way is it devious. None of those enterprises are devious, it’s just new markets and new ways of doing business, and get a benefit from it, and the advice is that it is critical that you look not at the dollar value at all on any of these things, but the fit. Because if the fit works, then your obligations aren’t going to distract you from your core business. Because it is just going to be your core business, but as soon as you bullshit and change your idea for it to fit a partner, then all of a sudden you’re going to be hit with so much more work because you are having to create outside of what you are already creating.

Is this a common way in which artists deal with their arts partnerships? Do they change what they initially set out. Is that true?

I don’t think so, I can’t answer that. But what I do see is that the partnership doesn’t extend beyond that project. The best possible scenario is that an arts partnership continues to grow and change and work with each other as the years go, as both partners move and change and serve each other.

I mean, partnerships that are short term must become long term, but what I noticed is that if an organisation partners with a service or product, it only exists for that period of time.

For instance, a service like Legal, Freehills. A product like …

Like Volkswagen. So, similar to funding, I believe partners work in triennials funding, three year lots. So it’s not ridiculous to engage with a partner in its initial consultation within three year plans that makes sense to them. It also gives them a lot more leverage and gives them the opportunity to access a lot more markets. We have small indie event experiences here that attract about 120 to 200 people.

That’s a niche market!

Yep, that’s a niche market, and they have Jamiesons Whisky. Everyone here gets Jamiesons Whisky for free, how did they get that sponsorship? They got the sponsorship because the sponsor rolls over into event after event. So what eventually happens after 3 years, it is not just 120 people. It’ll be 80000 people who would have experienced the product in its environment that they could never replicate, but fits with the brand idea of “enjoy our scotch with an indie film”. I think that’s how they made that happen. Marvellous, and it looks like everyone is really happy with that. Even Jamiesons is very happy, when I watch them do their events here.

Similar, we did an event on the weekend that was a Grolsch sponsorship. For a brewery, getting product into a room is what they need, costs them no money at all, and the guests get free alcohol. If it’s an in-kind sponsorship like that, it’s actually that the business walks away with a lot more than the actual producer does. I think that’s got to be watched.

You mean the producer of the art event?

Yes, because they get their product into the hands of people, and they think that then the  product is responsible for the event. I mean, if they don’t know the producer, then that’s probably what they’re thinking. So that’s what people have to really watch. It’s no spend to get a product into a venue, but its high exposure. People should be paying for that.

I did a cultural event for Waterloo, and Red Bull have their head key office in Waterloo. The event wanted to have Red Bull girls come in and give out Red Bull, and they thought that was a great idea, because it means my guests get Red Bull. But the thing is, you actually get exposed to a huge market. You’re gonna pay for it and put down $10,000 for three hours.

The thought that comes to me is that there would be a cultural clash. An indie event and Red Bull girls, they represent two different cultures. Do you find this is how it tends to be with indie, (film, music, art) and sponsors? Are there many clashes, or do you see a confluence a fluidity?

I think the sponsor is out to get something quite significant, so lets say the Red Bull sponsorship, there is a cultural clash there. because the key market of that event is indigenous young kids, skaters, and the Waterloo community. They’re the last people on the earth who should be dosed with up caffeine and sugar. I mean, that’s wrong.

Yes, that’s wrong, but is that what drives sponsorships? Ethically wrong, ethically right? It does?

No not necessarily, it’s an individual relationship. But they’re not being charitable, they’re trying to solve their own problem. A massive thing that happened to Australian Theatre for Young People, about 10 years ago, is they got a Coca-Cola sponsorship. So ethically that’s quite a huge problem. Similarly taking a McDonalds sponsorship. Whatever happens, your brand will be aligned to your sponsors regardless. And you will sign an agreement that will mean that you will agree to the ethics of the sponsor. And you can not trash it and all that kind of stuff. So, regardless of whether the biggest cheque you’ve ever seen in your life, if it doesn’t fit with what you’re doing, never ever touch it. because it will end up hurting you a lot more than the sponsor, and you will be doing a hell of a lot of work to put out the fires.

So it’s the work of the recipient to call that out?

Yeah totally.

With your partnerships, how was the process of getting these partnerships or sponsorships together?

For local government partnerships, it’s a lot more about application writing and aligning activity with the visions of the local government area, which is part of their social or development plans, so that’s easy to do.

With local business, it’s a lot more about forming real relationships face to face with people, and building trust and then asking for extremely significant small amounts of cash or in-kind, because they’re struggling as well.

What type of relationships? “Hi, how are you?” or more?

Yeah, it’s a “hi, how are you? We’re in the neighbourhood, this is what we do, we’ve noticed you are doing this thing coming up, we need some support, we understand times are tough, what were asking of you is ‘x y z’ and bit of support here, and what we can return to you is this”, and therefore your benefit will be acknowledged as a community supporter.

What is the success like for getting local businesses on board?

Quite significant if it’s of benefit to the widest amount of people in the community as possible. Local businesses cannot give cash. They’re struggling for cashflow themselves, but they can give product or service. So I wouldn’t bother going to a local business with your hat in your hand. I’d find ways in which that businesses current service and products can assist in the activities you are needing sponsorship for.

But with the corporate sector, it’s a completely different deal, because you are competing against opportunities for them to put their money onto a billboard, or into a magazine, or onto TV where they get loads more exposure. So it needs to be an incredibly calculated approach. First and foremost, do an initial conversation on telephone with the secretary, which will be shortly followed through with a very complex sponsorship proposal or business plan, which then would become a hard-come canvass sell to get a meeting in a boardroom with …

The person seeking sponsorship needs to have a very good business plan.

Totally, because essentially they are investing in a part of that business plan. And they need to see that you are sustainable, they need to see that their investment will roll over for longer than the event itself will happen.

Sustainable for those three years they’ve sponsored for?

Yeah, could you imagine saying “OK I endorse this idea” and the idea goes down after the first time its been shown, because everyone’s exhausted or everyone’s out of money or no one rocked up? Can you imagine what it would be like putting your name to something that fails? So, you have to speak in their language, and their language is strategy, and their language also has a hell of a lot to do with ego. So by doing your homework, and looking at their annual reports and business plans, looking at their websites, their collateral, you’ve at least got an idea on how to frame your activities so that it speaks to their vision.

Because essentially everyone in business is answerable to somebody. So you speak directly to the marketing and public relations departments, because that’s where you send all your sponsorship proposals. They then speak to their executives, who speak to the Board, who speak to the shareholders, well the CEOs would speak to A.S.I.C., and the chain of command goes higher and higher and higher and higher. so everything’s got to be accounted for, every decision for a Pty. Ltd. would essentially always be in the back of your head, how the shareholders gonna benefit from that. But that kind of stuff would be multi-million dollar sponsorships.

For the small fry, you’d probably only go as far as marketing, and then maybe the next department up would be the managers.

Well, a lot of companies would often give round about $10,000 to an event, compared to an advertising budget of a billboard or TV, you’re looking at figures much higher than that.

Yeah, $100,000.

so $10,000 isn’t that much, so given that $10,00 is far less down the line with an impact on the niche markets, to me that sounds like it would be a good strategy for them to take, to do sponsorship.

Yep.

Is that a common view?

Yes. But the sponsor knows you will give them more, because you don’t know what you’re doing.

You mean the people who organise what they organise?

No, the marketing and PR department of XYZ Pty. Ltd. (Australia), knows quite well that with that $10,000 they give to XYZ Inc. Association Arts Group, they would be able to negotiate far more bang for their buck than an advert gives them. So they know full well that they can get a hell of a lot more out of that sponsorship. They know those groups are under-resourced, hungry for dollars, and will get on their knees for that $10,000.

So then what do Inc. association need to do to get in the space so they aren’t taken for much more than they actually are?

Just got to be confident … oh, first they’ve got to understand the culture of the sponsors. Understand what their potential value is, and kind of dig their heels in and if they get something that is unacceptable, say no or renegotiate. The biggest thing that is happening is that sponsorship is going to die, and is not going to be sponsorships anymore. It’s going to be ‘charitable donations’. So organisations that are incorporated need to get on the list of charities and cultural organisations, and get DGR. Because that has a lot more value than a sponsorship does now.

Why do you say sponsorship’s dying?

Because, Pty. Ltd’s are starting Foundations. It is a safe way which to hold reserves, so all they need to start a Foundation is to have a vision and charter and be philanthropic, and in return they receive 100% back on their tax. So it’s a tax dodge, but it’s set up specifically so more money goes to charities and the arts. And it’s obligation free.

How’s that in your view?

It’s fantastic. because it’s obligation free. They’re not allowed to acknowledge that donation, so I get $100,000 from Coca-Cola, no one knows that $100,000 came from Coca-Cola. It’s not acknowledged anywhere and that’s part of the deal. So it is essentially the ‘free money’. Well, it’s not free, you’ve got to apply for it. Or you’ve got to build that relationship. But the sponsor, say Coca-Cola, gets a significant value back, which is a cut of tax. And if you’re coming towards June 30, and you’re going holy hell, we’re looking at a massive massive tax debt, oh my god we have to offload right now $100,000″. If you’ve announced your donors plan and it’s on the right desk at the right time, $100,000 will be written to you within the afternoon. That’s the reality.

So sponsorship is complicated, because it comes with a lot of contractual agreements, conditions. Donor law can’t, but with a DGR it’s set up purposely that you have an external body within your organisation, external bank account, so you can’t just spend that money willy-nilly. You have to then approach the Committee that you’ve established, who are your Foundation’s Committee and propose to them “you know that $100,000 I got from the Coca Cola Board, we need to buy a new floor” and the Board will then determine whether that’s a good spend or not. So all organisations now have Foundations. It’s a very complicated situation to get the DGR status. But well worth it.

For a small association to approach a large organisation, I imagine for them, due to culture or for other reasons, that they need to take on certain ways of communicating, certain ways of talking. What do you see associations not doing, and what do you see they need to do in order to communicate well with those types of organisations?

I think with any partnership, and particularly a partnership with business, the sponsee, the person approaching the sponsor needs to be empathetic to the sponsor. So its’ fine to be all bitchy about business, but you can’t then approach business with the hat in your hand, when you have no empathy.

Does that happen often?

Oh totally, I mean we’re still a community who refuses to bend for the business, and bitch the fact that business doesn’t come to us. But in actual fact, in order for us to build a proper case to business we need to speak and understand what that business is attempting to do, and say “you know what, as an arts organisation we can achieve what you need to do, and you can’t do, and we’re the only ones who can do it”. So It’s changing your mental headset about business. Sure you can still hate capitalism and that kind of stuff. But if you’re going to play in capitalism, yeah you need to find the fit. Not compromise your values or ethics for that, but find where your specific service can benefit the service of the sponsor.

So read their Annual Reports, read their websites, go to their Foundation’s websites, find out what their core value is, and then speak to that, if your service fits it.

In order for those interested in just getting Grants, and comparing Grants to Foundations, organisations and small business, which of those four have you found give more product or cash? Is it an even load?

No, they’re all completely different things, but if anything, a partnership ends up providing more because the relationship is longer term when it’s established and the relationship grows over the terms of that particular partnership, so they can see ways in which they can assist in kind or even in cash above and beyond what you have estimated.

With funding, it’s cut and dry, it’s within perimeters that never change. The difference in funding though is that what artists need to consider is long term. Start small, build a relationship, show you’re accountable, responsible, you deliver what you say, you are constantly meeting need, and each time you apply, you’re building relationships. “Thank god we got this application again from this group, because they’re wild”. Understanding, that again they’re answerable, so a Government Body that gives out money is answerable to the Commonwealth. The Commonwealth asks them “so are you meeting need?”. And so they can go “look here, we fund XYZ, yes” so they own your product to some degree in reporting stakes to their bigwigs.

But it’s a long relationship for an organisation to pitch towards major organisation stakes or even triennial funding, give yourself five years of building from a $500 grant to a $1000, to $1500 to $200, to $3500 to $10,000 to $15,000 to $20,000 to then going, OK triennials of $150,000 every year for three years blah blah blah, because essential you’re building trust with the administrator who pitches your application to a Board of peer assessors.

It’s about relationships!

Always, and being honest.

And understanding those two things, relationship and honesty, gets you where you want to go.

it’s ethical biz and people respond to ethical business, even if you hate business, it’s ethics.

Which industries have not being open to the arts community? Which ones do you find are more of a waste of time and not that communicative?

The arts industry.

The arts industry sponsoring arts companies?!

Yeah, they’ll never do it.

OK.

No, everyone else is very responsive to arts. Even mining companies and property developers.

Virtually what you’ve got.

Yes, it’s about the fit.

Which have been the most innovative partnerships, grant relationships or sponsorships that you’ve seen around the world? Which ones have inspired you the most?

That’s a tough one. I see the Optus relationship with Company B, which is now into its 15^th year as really significant. I think the Freehills relationship with the Company B Education program, that’s been around for four years, I think that’s really significant.

What makes it significant?

I guess it’s because of the transparency of the relationship. Both have grown together. Because essentially it’s altruistic, the idea of sponsorship, and the desire to be closer to that culture. I mean, the Optus sponsorship gets value from Company B, but they also really enjoy the relationship they have.

But why are they attracted to the arts, and not, say…

Maybe the initial sponsorship campaign was about underlining the fact that theatre is a communicative tool and so is telephony. Maybe it was that simple. Maybe it sparked the PR or marketing department to say “Oh my god, I see that as an advert, I can see how that can work”. Also, they would have said “do you know that we developed the careers of Geoffrey Rush and Cate Blachett?”. It would have been that! It’s all about leverage.

There’s an amazing organisation, it’s been around for years, in London called ACME, a not-for-profit organisation, they’ve got around 80 properties now in London that they have been able to fund through philanthropic donations. So they marry rich people who have lots of money, but want to do something for the community and don’t know how to. They take their money, buy property and bring the people, the artists into studios.

Sounds incredibly smart.

Yes.

Property in London. Not cheap.

Yeah, so that’s a massive successful model.

Can you see that happening in Australia?

Yeah, well we’ve been asked to consider an application to view their business model. So that would be ace. Because that is what we want to do in the next step from here.

That sounds fantastic. Talking about the Global Financial Crisis hitting a lot of arts organisations around the world, with many closing. Have you seen the same thing happening here?

No, not at all. I reckon all those kind of things are a little bit top-end. Of course they do affect the person at the bottom of the pyramid quite significantly with job losses, interest rates, tightening of the purse and all that kind of stuff.

What were talking about here is money that doesn’t exist, and that’s where the problem was. In regard to shares and investments, it does trickle down. Artists are innovative, resourceful, entrepreneurial, and at the end of the day, I guess what happens is a crisis just shakes the Board a bit, and it becomes an even playing ground again.

For those who are considering new business, enterprise or new projects, it’s a perfect time to start. Because old wood has been thrown out, and a hell of a lot of people are looking for new ideas. And they know that the new ideas are going to give them the wealth that they once experienced, so they’re interested in new ideas. A lot more opportunity for investing now, because the old ways didn’t work.

What have you learnt, and how do you see the future going?

I think the future is going to be about artists considering their work to be more small business related, being a service to the world and saving the world. People are going to be more sustainable, so therefore they are going to be considering more opportunities to have their stuff provide themselves income, rather than asking other people for support. So income generation equals self-determination

Financial sustainability.

Yep, that kind of thing. I think what is going to happen is that, in turn then, because there will be more, for better term, more products on the market, then the general public will engage because it will be about critical mass of products, which in turn will get punters through the door. Box office will then get sales of art, which will get more mainstream getting involved in indie culture, and then ‘independent’ will then become the mainstream.

That’s a positive outlook.

Well, that’s kind of a model that’s happened everywhere. Constantly a turnstile that happens here in Sydney. I mean, all the major organisation who are now considered as key organisations, i.e. Bell Shakespeare, Australian Ballet, Sydney Dance Company, they were all indies. They all started with $30 in the back pocket and couldn’t afford to eat that night. I think they might have all started at the time of a significant recession too.

In the 70s during the Whitlam era.

That’s Nimrod. Nimrod finished because they got kicked out of the building. But that got so many people angry, they decided to buy a building, and that became Belvoir Street Theatre. The Stables was then given out of protest back to the group, which became Griffin. Then John Bell left and started Bell Shakespeare. There you go, three key organisations who started out of poverty and a sense of lefty-kind of taking back control, and look at them now!

Thanks, James.

* Deductible Gift Recipient

Tell me about the Centenary Institute

The Centenary Institute is 200 people doing basic medical research into cancer, cardiovascular and infectious diseases.

How long have you been doing it?

Centenary’s been around for 25 years. Our name, an odd name, actually refers to the centenary of Royal Prince Alfred Hospital, and the Sydney University Medical Faculty.

What got you in here?

My friend rang me (laughs), and said “I’ve got a great job you should go to!”. We had a change of leadership, and our new director was previously the chair of an industry body that a friend of mine was involved with. And he asked her about people around the industry, and they headhunted me in.

What brought you to the point that you could get this job?

Sure, OK, so my CV. I went to university and did a bachelor of Business with a double major in international trade and marketing. And I went in India to investigate the free world, and all that sort of stuff. But somewhere along the way I decided I wanted to go into events, opened the paper and the only events job in the paper that week was with the Multiple Sclerosis Society. Applied for it, got it. I spent two years running their massive outdoor events, ‘Sydney to the Gong’, that sort of thing. Then I went to another charity, set up a foundation, went to London, traveled the world, did some PR over there. Came back, and I’ve really been in charity fundraising roles ever since.

What have you gotten out of each of your positions?

So I guess the great thing about the fundraising sector for me when I was starting out, was the intensity with which the diversity of the roles, and the incredible responsibility I guess, access I got at an early age. So three months into my career, I was managing a finish line with 10,000 cyclists, 50 teams, 10 corporate sponsors and 8 bands, and I was the only staff member on site for the day. So, that’s a pretty remarkable opportunity for someone who is very young and fresh out of uni. That doesn’t happen very often. Then my next role, the role was built around me which again I was very fortunate. And that was very much a start-up. And again, I was working with everything from world-famous musicians, to homeless kids, setting up innovative new programs, all sorts of things like that. That was really exciting, plus I guess, the obvious part, its an incredible industry, you get to go home at night and the world is a slightly better place as a result of you working.

London was just brilliant. I did London fabulous PR, traveling the country, talking to the CEOs of some really interesting companies, doing some great corporate social responsibility stuff, so that gave me huge access in the UK. Talked to some of the top publications. I went and worked with a small international Non Government Organisation , that was interesting. That was my second small one, when I was in charge and really building things. I realised I loved it and had a real aptitude for that. Great, I got to take some people over on an East Timor study tour and, you know, a little bit of international travel there. Then I was at the Heart Foundation, set up the “Doorknock Appeal” for their national fundraising team. Fascinating again, huge challenge, $4 million budgets, really exciting national role. Then here, it was really a chance to sit on the executive of the company. Start from scratch really. I had 800 donors, now we got 5500, and the Board has just approved a plan to get to $4 million a year from the half a million they were raising when I got here. It’s really exciting.

Where does Centenary concentrate get their money from?

There’s two things. Medical research is by and large funded by what they call ‘peer reviewed funding’ which comes from government sources, and people like the Heart Foundation or Cancer Council have a competitive grants program. But for every dollar we get in those competitive research grants, we need to raise another seventy cents. But historically, that was pretty much picked up by the State Government. But, State Government funding has quite significantly declined, the infrastructure in NSW, hence the Foundation. So …

Is that a NSW thing? Or Australia

It’s State Government infrastructure and varies state by state. So we’re doing lobbying and in the industry body, and getting people looking into those sorts of issues. But the area I really run is the Foundation. So that is, we look at, income from individuals, be they incredibly wealthy individuals to what we call “Joe Bloggs Doner”, so $10, $20 donors, we’ve been in the position to get a lot of those. We have a couple of events that are run through our foundation, which is a sub-committee of our Board. Then we also have some corporates, trusts and foundation. But it’s evolving.

So out of the number of different avenues you can get funding from, which one brings you the greatest success?

So I guess for our organisation, the biggest success is with ‘Peer Reviewed Funding’. But that’s an industry-wide thing. I guess, for people reading the blog, who are the fundraisers like me, that’s not our area, ours is more the foundation/ fundraising that I was touching on. So, all of the growth and benchmarking, world industry reports, is that growth comes from individuals that are diversified….a holistic individual fundraising approach is the most sustainable and potentially profitable, and particularly the growth model is the best place to invest.

What do you mean by ‘holistic’?

So, holistic is, there’s this fabulous concept called the ‘Donor Life Cycle’ where you pull someone in as a cash-giver, so someone gives you $20, you write them a letter saying “would you give me $20″ “yeah sure, here’s $20″ (laughs) and then you can leave it at that, right. And you keep writing to them asking for $20. Or you can think about it, the ‘Donor Life Cycle’ might bring them in as a cash donor, then you might look to upgrade them to their maximum cash gift, which for some people might stream them into becoming more, what you might determine as a ‘Major Donor’ . So at Centenary we might call those people who give us over $1000 a ‘Single Gift’ or you might ask them to become ‘Monthly Givers’, so they give to you every month instead of three or four times a year when you write to them. Then you make sure you maximise their gift, and also looking at their networks to make sure you’re activating their networks as well, and ultimately, encouraging them to leave bequests to your organisation.

What networks do they have?

‘Network Fundraising’ is very much at the ‘Major Donor’ level, so that’s looking at things like having functions and talking to your key donors and saying “do you know anybody else? Does your company get involved in philanthropy? Is there a way you can support us through your company?”. Doesn’t work for the smaller donor values, but definitely high value its peer to peer fundraising very much.

How has the Financial Crisis, however they choose to call it, how has Centenary been in this financial crisis?

Yeah, I guess, the good thing and the bad thing.  Centenary doesn’t have a lot of corporate sponsors and it’s in the loss of corporate revenue that most of the charities have suffered the most. So we didn’t have a lot to lose. In a way that’s a good thing, so we weren’t exposed …

Was that a deliberate thing?

Well we didn’t focus on it. I haven’t focused on it. It’s not, for a small emerging organisation like ours without a huge brand profile, we don’t have a lot to offer a corporate operation. So we’re more interested in building our Donor profile, all that sort of thing. And then using corporates as an incidental, so for examples, someone comes up through the Boards networks, we’ll see that opportunity.

Does Centenary collaborate with many other bodies much?

Research is incredibly collaborative, we have 65 different collaborations around Australia and the world from individual projects, so definitely at the research level. From a fundraising point of view, absolutely it’s vital in a small organisation that you maintain your networks. I have friends former colleagues, some fabulous suppliers, some fabulous email news things, fundraising philanthropy magazine is invaluable. I’m constantly checking with the external environment , and catching up on trends and reading the best books. There’s some great international commentators.

How much time of your day do you spend doing research?

OK, well, ideally, I would spend two to three hours a week catching up with industry trends, what is happening on average. That might mean I go out for a training day, and I don’t do anything for a couple of weeks. I try and devote two to three hours a week, and I get my staff to do that as well.

But I know, that Centenary, we’ve been incredibly fortunate to have a remarkable Board, and a remarkable fundraising and marketing committee, and we certainly have been really fortunate in attracting great talent to that.

Funding for medical research as a whole, across the industry, has there been more funding coming in recently? Has there been a change?

OK, at a government level, it’s stable. At a philanthropic level, honestly, people like to draw these conclusions that one sector is easier to fundraise for that the other, or you know, arts is in vogue at the moment. I think the reality is that, a professional and responsibly approach from an organisation that actually follows through and says, and is doing something reputable and valuable in the eyes of the community, whether that be fluffy puppies, art or cancer research, you get money for that, and if you ask properly and do it right, I think that all the evidence would suggest that it’s not the trend/ industry-type speciality you’re in that impacts your funding, it’s whether or not you are a good fundraiser, and your organisation is actually doing what it says it does.

I’m Eric Vigo, Director of The Funding Engine.  Thanks for coming to see the more non-managerial side of TFE! I hope you get as much out of this blog as you do from our sponsorship database system.

In gathering ideas for this blog, I thought about the state and set-up of what blogs seem to mainly offer: opinion. What I want to bring instead is data, and the transfer of data into knowledge about sponsorship, funding in general, who gets it, who doesn’t, and the effects on our society as a result.

A few questions I want to research over the coming future are:

• what holds some people back from financial viability? What projects them forward?

• what is the end result for society when sectors requiring funding get or don’t get their funding?

• in the myriad of different sectors, which ideas could be funded?

• who is charting new territory, coming up with new ideas and implementing them?

A more interesting way of getting to these questions and more, is through this INTERVIEW-BASED journal blog. I plan to post a new interview (done by myself) each week to two weeks – all depending on my main data entry workload. There’s a lot of sponsored events that happen out there …

I’ll also post tips, hints and ideas that I get from talking to all those who subscribe to TFE, as well as links to other fantastic sponsorship blogs or sites, and facilitate add-ons to make this a good centerpiece in any sponsorship or marketing researching task.

PERSONAL NOTES ON THE FIRST TWO INTERVIEWS

My first interview was with Sally Castle, who has been doing some amazing fundraising in the medical research area. She’s a focused woman (and friend of mine going back years) and she loves her job. What I picked up was her realisation that the old ways of gaining funding pre-GFC is over, and don’t forget about the individual donations.

The next interview is with James of Queen Street Studios. I would recommend anyone who want to do something constructive in metropolitan arts scenes to visit his site, and see what they are doing. What impressed me was James’ forward thinking in securing new space in developments to facilitate artists’ spaces. This is a new concept for Australia, and as he says in Part 2, the idea had a genesis in London. Proof that combining a creative and artistic mind with brilliant business acumen is no barrier to success.

I would love to hear your feedback, not just on the interviews themselves, but on the concept of a blog as an interview journal.

Adios, schuss and thanks for watching!

Eric Vigo

Director

The Funding Engine