Theatre is always a reflection of its time, and right now, the arts sector is at a crossroads. Theatre Facts 2023, published this week by Theatre Communications Group, gives us a data-backed reality check on where U.S. theatres stand financially. While the numbers are from 2023, they offer a roadmap for small theatres (budgets under $3M) trying to stay resilient in a rapidly changing world.
And let’s be real – between economic uncertainty, rising costs, and shifting audience behaviors, the pressure is heavy. For so many of you, it’s not just about keeping the lights on; it’s about preserving a vital part of your community. It’s about honoring the work, the artists, and the audiences who depend on what you create.
It’s hard. And it’s not fair.
But if there’s one thing we know about theatre people, it’s that we adapt. We build from what we have, and we find a way forward. Theatres that take a proactive approach now – rather than waiting for things to “go back to normal” – will be the ones that make it through.
So here’s what the report tells us – and what small theatres can do to navigate these tough times.
- Grant Funding is a Lifeline – But Also a Risk
Government and foundation grants have helped many theatres survive, but they aren’t guaranteed. Funding priorities shift, economic conditions tighten, and political landscapes change. Relying too heavily on a few major grants is a gamble.
We get it – when you’re already stretched thin, finding new funding sources can feel overwhelming. But a funding plan that depends too much on external grants can create instability down the road.
What You Can Do: Start small. If the idea of overhauling your funding model feels impossible, focus on just one area at a time – maybe that’s strengthening relationships with local businesses, expanding grassroots donor campaigns, or testing out a membership program. Sustainable funding isn’t about replacing grants overnight; it’s about gradually building a stronger foundation.
- A ‘Positive Balance’ Can Be Misleading
Some small theatres reported better Change in Unrestricted Net Assets (CUNA) than mid-sized peers, but let’s be honest – many are still operating on a financial knife’s edge. One unexpected cost (a failed HVAC system, a canceled production, a funding delay) can send everything into crisis mode.
If it feels like you’re always one emergency away from disaster, you’re not alone. Many organizations are feeling this, even if their numbers looked stable on paper. The reality is that financial health isn’t just about breaking even – it’s about having breathing room.
What You Can Do: If you’re constantly in “survival mode,” it may be time to rethink your structure. That doesn’t mean drastic cuts – it means taking a step back to assess what’s sustainable. Maybe that’s adjusting the scale of productions, strengthening financial forecasting, or finding trusted partners who can support operations and marketing without adding full-time salaries. (This is something we’ve seen a growing need for, and we’re expanding resources to help.)
- Ticket Sales Are Recovering… But Another Drop is Likely
Subscription models have taken a hit, and audiences aren’t committing the way they used to. And while some theatres have seen attendance improve, it would be a mistake to assume a full recovery is coming.
Multiple studies -including this one -show that pre-pandemic sales levels aren’t just slow to return; they may never fully come back. And with inflation tightening household budgets, we should expect another drop-off in discretionary spending.
This is frustrating. You’re doing everything right -programming great work, deepening engagement, adjusting marketing -but audience behavior is shifting in ways we can’t control.
What You Can Do: Budget conservatively. Avoid basing next season’s projections on an assumption of “getting back to normal.” Instead, meet audiences where they are. Try choose-your-own packages, membership perks, or pay-as-you-go models that lower financial barriers for audiences who want to be there but can’t commit the way they used to.
- Rising Costs Are Squeezing Small Theatres
Inflation, wage increases, and production costs keep climbing, while most theatres are already operating with minimal staff. Every financial hit feels bigger when you don’t have much wiggle room.
If you feel like you’re being asked to do more with less, that’s because you are. The financial reality of running a theatre in 2025 is fundamentally different than it was even five years ago.
What You Can Do: If hiring full-time isn’t feasible, look at project-based solutions or shared staffing models to fill gaps efficiently. If you’re in this boat, you’re not failing -this is just the reality we’re all navigating together.
- Government Relief is Unpredictable -Theatres Must Plan for Themselves
The biggest financial challenge many theatres are facing right now isn’t that pandemic relief funding is gone -it’s that those funds made things look more stable than they actually were. Now, as real financial patterns emerge, it’s clear that many organizations are still struggling.
And if another major crisis happens -whether economic, political, or otherwise -we can’t assume the government will step in to save the arts.
That’s a hard pill to swallow, but it’s also a wake-up call. Theatres that take control of their financial future now will be the ones that weather whatever comes next.
What You Can Do: Take a proactive approach to revenue planning. If you relied on one-time grants to balance past budgets, now is the time to shift to sustainable sources -recurring gifts, corporate sponsorships, and donor strategies built for long-term stability.
Where Do Small Theatres Go From Here?
With funding uncertainties, rising costs, and audience behaviors shifting again, small theatres need to plan ahead, not just react to the moment. It’s not an easy road, but it’s one you don’t have to navigate alone.
- Plan Conservatively for Ticket Sales – Don’t assume pre-pandemic levels will bounce back quickly. Expect another drop as discretionary spending tightens.
- Diversify Your Income Streams – Reduce reliance on grants by growing corporate sponsorships, mid-level donors, and membership-style giving.
- Create a Cash Reserve – Even saving 1–3 months’ worth of expenses can prevent crisis-mode decision-making.
- Be Strategic About Staffing – If hiring full-time isn’t feasible, look at project-based solutions or shared staffing models. (We’re currently expanding support for small theatres who need marketing and operations assistance.)
- Be Intentional with Digital Offerings – If hybrid programming is part of your strategy, ensure it’s both financially viable and audience-driven.
- Rethink the Subscription Model – Flexibility is key. Offer audience-driven packages that meet today’s reality.
You’re not alone in this. The landscape is shifting, and no one has all the answers. But planning now -before things reach a breaking point -can make all the difference.