Approximately two years ago, we made a prediction at Inside Philanthropy:
Alice Walton, we said, will emerge within the next decade or so as "the most important arts philanthropist in the United States. And she'll create the largest arts foundation in the nation's history, bigger than either Getty or Mellon."
Recent developments suggest perhaps we should apply our powers of prediction to a more remunerative line of work. Sure, writing about philanthropy is nice, but working for, say, a hedge fund could be far more lucrative.
Walton's Crystal Bridges Museum of American Art in Bentonville, Arkansas, recently announced plans to transform an idled Kraft cheese plant into a space for contemporary art exhibitions, artists' projects, music, theater, and film. This development is important for obvious and less-than-obvious reasons, and we'll get to them all in a second. But first, let's loop back to our earlier prediction to contextualize this development. The writing's been on the defunct factory wall for some time.
Let's start with money. In 2010, a year before Crystal Bridges opened, the Walton Family Foundation gave two huge gifts to the Crystal Bridges Foundation totaling $1.2 billion. That came on top of previous Walton gifts to the foundation of nearly $400 million. As of 2011, Crystal Bridges had an endowment on the order of $1 billion.
Basic business and philanthropic logic suggests that you have to spend money to make money, so while Walton, prior to this announcement, had been relatively mum about her plans, no one in their right mind expected this reservoir of cash simply to sit in the bank. As we noted at the time, "it makes sense to wonder whether that institution is likely to become far more than a museum, but also a grantmaking foundation itself — supporting individual arts, arts education, and arts organizations."
What's more, while we noted that Crystal Bridges would be an ideal platform upon which Walton could expand her arts philanthropy, the space itself was, for practical purposes, insufficient: The Crystal Bridges complex is about a quarter of the size of the Getty Center.
Enter the cheese factory.
The fact that Crystal Bridges can purchase a 63,000 square-foot space speaks to fact that Walton is well-positioned to make our prediction a reality. Let's start with location. Unlike densely populated urban areas, Bentonville (population 40,000) is surrounded by vast oceans of empty and relatively inexpensive space. And so while big museums in New York and Los Angeles transform neighborhoods, the new building, located in Bentonville's downtown market district, will transform an entire city and its outlying areas. Tom Walton, Alice's nephew, said he hoped Bentonville would "become one of the hottest destinations in the country."
It's a noble aim, but it's a big ask. Again, logic dictates that it's more difficult getting people to visit a place like Bentonville because it's much smaller than larger metropolitan areas. People need to make the pilgrimage to the corner of northwest Arkansas.
And so Crystal Bridge's plan resembles the "Bilbao Effect," the idea that an architecturally exciting project makes an institution more of a destination. We see it all the time in the museum world, particularly in places like New York, where the total price tag of the city's dozen or so ongoing arts-related projects stands at a cool $3.47 billion.
The strategy makes for exciting fundraising letters, but as previously noted, there's an unwritten rule in arts management suggesting that allocating millions for expensive capital expenditures can be an inherently risky proposition:
Organizations face the depressing possibility of aborting construction if funds dry up. And then there's the issue on ongoing sustainability. As the New York Times notes, "If it's hard to raise money for new buildings, it's even harder raising money to sustain them." And yet, ironically enough, it's generally easier to raise money for something tangible than for unsexy operating expenses.
This brings us to the funder's second built-in advantage: Sometimes the rules don't apply to folks like Alice Walton, one of the richest people in the world, with a fortune of $33 billion. (Which is a lot more than J. Paul Getty ever had, by the way.) Walton has the money, the space, and the momentum necessary to casually brush aside warnings from consultants and well-intentioned philanthropy bloggers—Crystal Bridges welcomed more than 2 million visitors in its first four years, proving the Bilbao Effect is paying dividends thus far.
Another element to this announcement speaks to Crystal Bridges' disregard for conventional wisdom, and by extension, Walton's. It has to do with that dreaded demographic who'd rather spend their Saturday nights doing whatever they do on their smart phones rather than enjoying the arts: millennials.
Millennials, we're told, are too busy, too distracted, too unfocused to enjoy the arts. Oh, and they also don't financially support the arts all that much. No matter, says Alice's nephew, Tom Walton. "This project is going to be huge for the younger generation, the millennials."
In a city where 9.8 percent of its residents — or about 3,920 individuals — fall within the 18 to 24 age range, the millennials will have to be imported from other locales. The math seems daunting. Will hordes of millennials they really come to Bentonville? And will Crystal Bridge's focus on millennials offer a clue to Walton's future arts funding priorities?
We'd like to make a prediction but we'd rather quit while we're ahead. After all, the conventional rules of arts philanthropy don't really apply to Alice Walton, do they?