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The Physical Plant
The now famous Frank Lloyd Wright masterpiece that is the Guggenheim Museum was designed in the 1940s for a completely different concept. In 1983, former director Thomas Messer had set in
A Museum as a Brand?
motion plans for an expansion and renovation, but these were now long overdue. The projected budget: $55 million. But where would the money come from?
Krens became creative. New York State had a piece of legislation that allowed cultural institutions to issue bonds for construction purposes only. The bonds were triple tax exempt—which meant very low interest rates. The state granted the bond issue to one institution each year.
Krens decided to leverage the reputation and collection of the museum to take advantage of the legislation. He hired a leading architectural firm, Gwathmey Siegel & Associates Architects, to design a 10-story adjoining tower. His lobbying efforts were successful. The bond issue raised some $56 million, enabling him to restore the famous spiral building and extend its exhibition space by 60 percent.
That’s creative thinking applied to the most unlikely of business fundamentals: financing.
Before You Leap: When bringing creative thinking to your business, start by challenging every assumption. Continue by looking for every opportunity to apply creativity to business strategy, across the spectrum, even in the most unlikely of places. Leave no doors unopened.
As his next step, Krens turned his sights across the Atlantic, to the Peggy Guggenheim Museum in Venice. When the museum acquired Ms. Guggenheim’s collection and palazzo in the 1970s, it intended to bring the works of art to the Guggenheim in New York. It didn’t work out that way. The Italian government declared the palazzo and its contents a national treasure—the art wasn’t going anywhere.
Krens believed the city of Venice to be an ideal location—and one worthy of investment. With 12 million visitors a year, as he puts it, “it in effect exists for cultural tourism.” So he focused resources to the Peggy Guggenheim collection there in order to turn it into a first-rate cultural facility. His second move was on a grander scale. Krens’s thinking was that, if you had a museum in Venice and one in New York that were of similar size, you could achieve the economies
The End of Advertising
.the Beginning of Something New
ofscale for which he’d been looking. Mount an exhibit in one location. Restage the exhibit at a second location for a fraction of the cost. Unfortunately, the palazzo in which the Peggy Guggenheim collection was housed was much too small. So he set his sights on another location, this one just across the canal—the Punta della Dogana, a late-seventeenth-century classical pavilion at the very end of the Grand Canal opposite St. Mark’s. It took more than a decade to reach an agreement with the Comune of Venice, and negotiations are still under way.
Again, great creative thinking applied to yet another fundamental of the museum business—and a sacred one at that: location.
With the bid for that seventeenth-century pavilion, Krens put into motion the concept that would eventually redefine the idea of art museums in the twenty-first century: the concept of a Guggenheim constellation. The way Krens saw it, the Guggenheim would be one museum that happens to have discontiguous gallery space, placed all around the world, but with one collection, one programming concept, and one coordinated approach to understanding and presenting culture. All of the museums would be called Guggenheim.
In 1992, the Soho Guggenheim opened in New York’s trendi-est neighborhood. The brand was on the move.
Zero for Six
In addition to a master’s degree in art, Krens also holds a master’s in public and private management from the Yale School of Management. Perhaps that accounts for his businesslike mentality. As he says, “You have to see yourself as an investment banker. You develop 10 projects. You expect that your success ratio is one in five.”
Krens had no problem developing multiple projects simultaneously. It’s just that, in the early 1990s, none of them were coming to fruition. A deal to open a museum in Salzburg, Austria had stalled, as had deals for four projects in Japan and one in Massachusetts. Little did Krens know that his next stop would be an industrial port city on the Northern coast of Spain. . . .
A Museum as a Brand?
Bilbao is home to some 1 million Basque—nearly half the inhabitants of the surrounding Basque country. It was once thriving, but by 1989 it was in a state of deterioration. That year, the Basques hatched an ambitious urban-renewal program to transform the city into a modern-day commercial, cultural, and recreational center that would attract businesses and tourists from around the world.
Part of this plan was to create a museum of contemporary art, designed by one of the world’s great architects. Who did the leaders of Bilbao want to run the museum? Thomas Krens.