The venue was booked. They’d been able to get the Plaza Hotel this year. Charles Grodin, actor and newscaster, had agreed to perform as the Master of Ceremonies, and former NFL star Tiki Barber was planning on handling the award ceremony. It looked to be a banner year for the fourth annual Breakthrough Ball, which was hoping to raise more than a million and a half dollars to benefit the Children’s Cancer and Blood foundation.
Then Lehman Brothers announced it was filing for bankruptcy.
“That was a really stressful day,” remembers Jennifer Zaleski, the director of the Breakthrough Ball, echoing what many working on Wall Street felt at the same time. In an unfortunate coincidence, Lehman’s bankruptcy fell on the day of the Breakthrough Ball’s pre-gala auction, where the foundation was raffling off fine art, donated by ArtNet, in an effort to raise donations before the event.
“No one really knew what was happening,” she says. “People were afraid to bid.”
As a concerned organizer, Zaleski isn’t alone. Benefit season in the Big Apple typically begins in September, and many of the world’s preeminent charitable organizations hold events here, raising hundreds of millions for benevolent causes. But with the recent turmoil in the financial sector, charitable benefits are poised to have one of the worst years on record.
Benefits and galas in New York are typically a mainstay in socialites’ calendars. With price tags hovering around $1,000 for a ticket or $10,000 for a table, attendees usually float in the highest tax brackets, and financial services workers were often the first to snap up tickets.
This year is different. On October 16th New York City Comptroller William Thompson forecast 165,000 job losses in the next two years, with 35,000 of those specifically in the financial sector. This has meant that bankers are watching their spending. An evening hobnobbing in the ballroom at the Plaza, even to benefit sick kids, has suddenly become a discretionary expense.
“We’ve had to cut back this year,” says Zaleski. “The flowers and the auction items have been toned down.” Zaleski also says that she’s renegotiated the fee for a night in the Plaza’s ballroom. The famously posh hotel reduced its minimum guaranteed payment from $400,000 down to $300,000, after there were concerns that ticket sales weren’t moving as briskly as usual.
George Orfanakos, the Executive Director of the Children’s Tumor Foundation – which held its own annual gala on October 29th at Cipriani on Wall Street, says that his organization has noticed significant drops in giving across the board since markets began lurching downwards. As a result, the Children’s Tumor Foundation has revamped its fundraising strategy, including cutting back on flourishments at their gala.
During tight financial times a benefit must make these types cutback, Orfanakos told listeners at a recent presentation focused on maintaining charitable giving during the current financial typhoon. Every dollar saved on stage decoration, centerpieces, and giveaways is less money that must be raised for the cause, he said.
Even those still feeling secure have been slow to splurge for expensive table sponsorships or auction items, says Zaleski. There seems to be a contagious hesitancy as a result of the uncertainty in the economy. What’s more, friends may have lost in the markets, or even become unemployed. It may feel unseemly to bid high on dinners prepared by private chefs, or guitars that have been autographed by rock stars.
“People really don’t want to look flashy or showy this year,” she says.
In the end, the Breakthrough Ball did manage to meet its fundraising goal, including the proceeds from the earlier auction, raising one and a half million dollars in total. The night was a resounding success, according to Lonnie Soury, the director of public relations for the Children’s Cancer and Blood foundation. All 400 seats were sold. A live and silent auction was sponsored by Philips de Pury & Company, a reputable New York City auction house that typically deals in fine art, with the respected auctioneer Simon de Pury directing the bidding. Among the 83 luxury items auctioned off were five hours on a private jet, donated by Bombardier SkyJets, and diamond encrusted choker, donated by Di Modolo. Attendees included Art Garfunkel and hip-hop producer Swizz Beats, who recorded a song especially for the ball.
“It came off surprisingly well in a tough environment,” says Soury.
There were cutbacks, though. Auctioneers at Breakthrough Balls in years past would ask for direct service donations, money pledged for a specific purpose, such as purchasing new equipment for a hospital. Soury also says that the foundation wasn’t able to justify paying for extensive lighting arrays this year, in an effort to cut costs. Soury also arranged for the gift bags to be donated by haute couture designer Tory Burch, rather than purchasing an equivalent.
“We want as much money as possible to go to the kids,” says Soury. “We asked ourselves ‘how can we spend less money, where can we cut without losing the feeling?’”
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