The Convergence of IYRS and the Museum of Yachting: An Interview with President Terry Nathan
In May 2007, the International Yacht Restoration School and the Museum of Yachting have joined forces to coordinate their efforts, in the words of co-founder John Mecray, “to make yachting’s colorful history come alive.” In a recent conversation, IYRS and MoY president Terry Nathan (TN) talked about this new chapter.
Describe the process that led to the convergence of these two institutions.
TN: The two organizations began talking two years ago about a merger. Much of the process was about building trust. A merger of related nonprofits with overlapping missions can be difficult because it is partly about trading intellectual capital and, as Museum of Yachting (MoY) trustee Chuck Holland so eloquently put it, intangible equity. Organizations have legacies. IYRS had some good outside advice from mergers and acquisitions people that mergers are never between equal parties and how to address that fact in order to achieve the goal of merging—or in this case more of a convergence, since both legal entities remain intact. The IYRS operating budget is four times that of the museum. Naturally, the museum was concerned about being overwhelmed and its mission lost.
Understandably, trust was the most important element. We worked out a structure in which the boards and executive committees merged, and IYRS built into its mission a commitment to keep what the museum has historically done: preserve and present yachting and maritime history. In the end, a number of people both in and outside the two organizations were key in the discussions, including IYRS trustees George Isdale, Ed Kane, and John Mecray and MoY trustees Mark Bardorf, Dan Dwyer, and Bill Doyle. There was great help from interested outside folks too: Clay Deutsch, Richard Sayer, Don Wineberg, and Jimmy Gubelmann, who helped to organize funds to provide working capital for early post-convergence runway.
How do the donors and supporters of the two institutions feel about the convergence?
TN: I think it was the major donors that really moved this thing along—aided, frankly, by conditions in the marketplace. I remember Ed Kane making the point that there are perhaps too many marginally sustainable organizations with overlapping missions, all competing for the same major donors, and many of these donors wanting assurance that their dollars are going to institutions with reasonable ROI on the donation. IYRS’ senior development executive James Russell uncovered some interesting statistics that, in the last decade alone, the number of nonprofits has grown between 40 and 50 percent. I find this interesting at a time when many museums and cultural centers are struggling to be viable financially and relevant in the new world order of YouTube and internet content delivery where people decide how they want their education and entertainment. So I think our timing is very good; it demonstrates sensitivity to donors and market conditions. Even area foundations have applauded the convergence.
IYRS educational programs have been in a stage of intense development. Will the convergence shift this focus?
TN: No. Everything IYRS does is based on the fact that it is a school. That’s our core competency. Marketing VP Susan Daly, who will have management responsibility for the museum, makes the point that many very good schools have museums or cultural centers, and many museums have educational programs. In our case, the convergence is mutually supportive: the museum will bring a wider audience to the school, and the school will allow the museum to create more relevant educational exhibits, including restoration projects and living examples of yachting and maritime history. In the end, we are providing a richer experience for both our students and the public.
What is the process for integrating the two organizations?
TN: We are two organizations without much excess capacity. Consequently, “Be deliberate; be purposeful” is the mantra. With the help of Clay Deutsch from McKinsey & Co., with their “Cliff Notes” version if you will, we are incrementally integrating infrastructure— from facilities management and finance to fundraising and programming. By year’s end, we want to clearly articulate a robust vision that can be highly visible during the 2008 summer season. Clay has helped the management team really focus on the success-drivers,
How have the boards coalesced?
TN: Very nicely. IYRS is an entrepreneurial organization, and I think that many members of both boards are very supportive of this culture so long as we are mission focused, collaborative, and making progress.
What’s in the works for 2008?
TN: We are very excited about three early aspects: programming that is thematically convergent; facilities improvements at MoY; and joint fundraising opportunities. Beyond that, we want to have two major exhibits annually that execute on the convergence concept. One that we are working on for ’08 is a graduate fellowship of IYRS students to restore either a Fife or S&S Six Metre at the museum, wrapped in a retrospective exhibit of the yacht designer. The completed restoration will be sold and compete in the 2009 Six Metre Worlds here in Newport. But give us some time to work through the programming. We have only one chance to do this right from the start. There is no rush, and a lot of interested parties are watching.
What impact does this vision have on the two locations?
TN: Certainly the convergence makes us more of a factor on the Newport waterfront. We can capitalize on each other’s visitors, direct people to each other’s sites, and develop more visible programming that makes us another key player in Newport as a destination site. But more importantly, IYRS’s in-town location will make it easier for the museum to attract visitors with street-front space in the restored mill building. Their presence will also engage and attract more visitors onto the IYRS campus. The museum’s library, which will be moved to the mill building, will be open to both the public and to IYRS students. Major exhibits, special events, and on-water activities will continue to occur at the museum’s current location.
What’s next for IYRS?
TN: Executing. We need to get the mill building restored; continue to grow programming as planned, including introducing a third curriculum in marine joinery by 2009; and continue to build industry and philanthropic collaborations that have shared impact.
And at the museum?
TN: We need to create new revenue streams for the museum. The economies- of-scale part of the convergence will be accomplished quickly. What will make this convergence really successful is developing new and growing revenue for the museum during the next three years, and not just philanthropic support. An important intermediate-term driver will be to expand interest in the museum beyond the loyal and obvious supporters. The museum must reach out to help enlighten and instruct, and with the combined IYRS/MoY program opportunities, we can bring a fresh and very engaging program to the museum: we can combine traditional exhibit mediums with “live” demonstration, restoration, and performance.
Looking out three-to-five years, give us a general snapshot of the two organizations.
TN: From a finance perspective, IYRS gets an additional $500,000 – $600,000 in lease and program income from the mill building and new capacity challenges, including enrollment of 60-70 full-time students and over 300 continuing education students annually. The goal is a ratio of philanthropic support to income of 35 percent: 65 percent, respectively, and thus focus on long-term sustainability through endowment building. For the museum, we will be building awareness and generating income from larger events and broader content delivery, including school systems; the Web; and, if we are good and lucky, media channels like Discovery and other educational mediums. We have a wonderful opportunity. There could be additional future collaborations with other related institutions. With continued nudges by major supporters and cultivating shared equity, who knows?