The Newseum - Will It Survive the Sustainability Crisis?
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Case Code: BSTR529 Case Length: 7 Pages Period: 2005-2017 Pub Date: 2018 Teaching Note: Available |
Price: Rs.200 Organization: The Newseum Industry : Museums, Non-Profit Countries: The US Themes: -- |
Abstract Case Intro 1 Case Intro 2 Excerpts
Introduction
On August 28, 2017, Jeffrey Herbst (Herbst) stepped down as the CEO of the Newseum – a unique and interactive news-based museum that promoted free expression through exhibition galleries. With a $307 million debt on its building, $61 million annual operating budget, and about eight successive years of deficit in the books, there was a question mark hanging over the sustainability of the crusader of the First Amendment.
The Newseum had not reported a surplus balance sheet since shifting to its new venue in 2008. The latest available one, i.e. 2015, showed a revenue of $59.3 million and expenses of $61.9 million, leaving the museum with a deficit of $ 2.6 million. Most of the financial requirements of the Newseum were funded by a single donor – its promoter firm, the Freedom Forum. As of 2017, Freedom Forum had infused more than $500 million into Newseum. By 2017, the Newseum had gone through four rounds of lay-offs, which painted a bleak picture of its very survival. The one-of-its-kind of museum that had an annual reach to over 8 million students and millions of other groups globally, found a dearth of generous donors who could help it avert the crisis. The Freedom Forum also found it challenging to supply any further funds to the Newseum, pushing the museum slowly toward a possible closure.
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