Eric Tillich, president and chief executive officer of the Wisconsin Conservatory of Music, is issuing this vow to the community: If any child wants to take lessons in the organization’s historic mansion on Milwaukee’s East Side, the conservatory will find a way to make it happen.
It’s a pretty bold commitment for a nonprofit organization that has traditionally relied on its private music lessons to bring in revenue.
It’s also the kind of challenge the organization, having recently emerged from a burden of debt it’s been saddled with for years, has newfound freedom to tackle.
Three years ago was a different picture. With $750,000 of structural debt and its credit line weighing it down, the conservatory was forced to furlough staff.
The then-115-year-old organization was on the brink of closure.
“The conservatory was on really rocky financial ground,” Tillich said. “When I came on board (in 2016), what I saw were a lot of structural deficits; the organization was running a year-to-year operational deficit, which puts a burden on the staff and the mission.”[gallery type="rectangular" size="full" ids="442243,442244,442245"]
Those financial issues had been mounting for more than a decade. After the organization dried up its cash reserves to cover operational costs, it began taking on debt – all of which was exacerbated by the absence of a plan for growing its contributed or earned revenue.
The tide began to turn about the time Tillich took the helm in late 2016, when two donors issued a challenge to the board to raise enough money to wipe out its debt. The board completed the challenge in 2017.
Meanwhile, ensuring the nonprofit’s future viability forced the conservatory to find new revenue streams. Tillich, whose nonprofit leadership background has included positions with the Milwaukee Symphony Orchestra, Boys & Girls Clubs of Greater Milwaukee and Marian University, has made that his priority.
The organization, which is the largest employer of music educators in the state, found its answer in a need among area K-12 schools. In the wake of cutbacks to arts education, finding licensed art and music teachers to fill open spots has become increasingly difficult, as they are often part-time roles. Milwaukee Public Schools’ Fill the Gaps initiative is aimed at maintaining arts curriculum in classrooms by contracting trained educators via local organizations to teach until licensed art and music specialists can be hired for permanent placement.
The conservatory was approached by MPS with a list of schools that were in need of music instructors.
“We had a lot of amazing faculty that are trained and qualified that contribute to the creative economy here in Milwaukee and were ready to work, so it was a great match for us to have these faculty in schools,” said Shalisa Kline Ugaz, executive vice president of advancement and education for the conservatory.
It’s made financial sense, too. The school district pays the conservatory using its federally-mandated allotment from the state for arts education. Some schools had money available for a music teacher, but no one to fill the role, Kline Ugaz said.
With Kline Ugaz steering its partnerships with schools, named the Conservatory Connections program, the organization is now in 52 schools in six counties across southeastern Wisconsin, serving 11,000 students weekly. Over the past two years, the conservatory has gone from pulling in $275,000 from the program to $1.1 million. MPS represents about $400,000 of that total, Tillich said. The Conservatory also relies on contributed revenue to support the program.
“It was a great fit because we’re growing the Connections program and serving more kids, but also putting some stability behind the conservatory from a financial standpoint,” he said. “…We’re focused on what the need is. I really think that’s how you should approach business – you’re filling a need in the community, rather than just trying to sell music education.”
The conservatory has also seen growth in its bread-and-butter revenue stream, private lessons for children and adults, posting a 12 percent jump in those services in 2016, followed by a growth rate of about 20 percent in 2017.
Those factors have made for a much different financial picture, one that Tillich said is far from common among nonprofit organizations.
In 2016, the conservatory ended the year $180,000 in the black. Tillich projected it would end 2017 with a net income of $125,000.
“It’s a combination of being smart in terms of growing the organization without burning yourself with fixed costs and growing it to have a good ROI on our programs,” Tillich said. “We have a good balance right now.”
Tillich and Kline Ugaz attribute that growth to a few different factors. Part of it could be the economy, Tillich said, as families may have more discretionary income to spend on lessons.
Being in the schools, Kline Ugaz said, also lends more exposure to the conservatory’s teachers in the community and provides a new “pathway” to its doors.
Customer data backs that up, Tillich said. A recent survey of the organization’s customer base indicated that the primary reason people choose to take lessons there is for the faculty.
Tillich said the conservatory has also invested in geomarketing – an effort that’s yielded results that are standard to the industry.
“It didn’t blow us out of the water but I know it’s helping our marketing initiative just to get the word out,” Tillich said. “That’s a piece of the puzzle. We’re doing our strategic plan right now and realizing we’re just going to have to invest more in order to capture more of the market share.”
The conservatory is also working to grow its distance learning offerings, which will allow its instructors to teach virtual lessons to students outside of southeastern Wisconsin.
As the leadership looks to the future, the focus is on casting a wider net to the community.
“One of the things we’ve talked about is, how do we make this a community music school for everyone?” Tillich said. “Looking at the mansion, it can be off-putting. It’s iconic, but it’s a little intimidating at times. So our education team is trying to bring more schools into the building, kids who haven’t had a chance to experience it, and make it a center for everyone. We’re not just serving one population – we’re serving the community.”
Beyond getting people in the doors, that means a commitment to getting more scholarship money into families’ hands, bringing on more staff who are bilingual and hosting instrument drives.
“Whatever barrier there is for a child to study at the conservatory, we’re trying to remove that,” Kline Ugaz said. “Now that we just started to reach deeply into our programs, we’ve had overwhelming response from families interested in coming here. So we’re trying to figure out how to maintain financial stability and also how to serve the community.”
Tillich said the organization may launch a capital campaign to build up its scholarship fund, recognizing that there needs to be money if the conservatory is going to come through on its promise.
“If any kid wants to take a lesson here, we’re going to find a way to make it happen,” he said. “I don’t care what it takes. We’re going to go raise the money, we’re going to find a scholarship, we are committed to making that happen. It’s a new feeling and vibe for the conservatory.”