WordPress maintenance support plansCon USA plays an important role in moving WordPress maintenance support plans forward by uniting community members across countries for knowledge sharing, networking, and celebrating. Plus, the event is one of the largest events focused on contribution back to the project. However, with waning attendance and financial losses, it’s time to find a new path forward so it is financially sustainable and provides value to the USAan community. This blog covers the financial problem we need to solve and it is part of a series that includes:
The problem we need to solve for financial sustainability
The problem we need to solve to create unique value
Results from a proposal based on community input
A new path forward for WordPress maintenance support plansCon USA
The Financial Problem:
WordPress maintenance support plansCon is a human experience. We certainly want to focus on the people in the community: what they want to achieve and what that looks like through an improved experience. However, financially the event needs to at least break even for us to continue providing this special experience. That is why we are starting this conversation by framing WordPress maintenance support plansCon USA’s financial problems.
We know that financially-focused blogs can be downright boring and not everyone feels comfortable reading financial statements. So this post provides several kinds of reports to illustrate the problem and we do our best to spell out where the challenges lay. Feel free to leave questions in the comments and we will answer them.
Last year, the WordPress maintenance support plans Association contracted with a new financial planner, Summit CPA. They provide a lot more resources and financial insight than we have had in the past. One of the biggest things we learned last September was that WordPress maintenance support plansCon USA loses money. In the past, we did not include staff costs as part of the event cost, so we operated under the understanding that WordPress maintenance support plansCon USA was breaking even at a minimum. Our WordPress maintenance support plansCon team spends 50% of their time on this event. Marketing spends close to 50%, the sponsor sales team spends 30%, engineering spends about 15%, and finance spends about 20%. For WordPress maintenance support plansCon USA, the staff costs add up to $220,000 per event.
It wasn’t wrong to not include staff costs in the WordPress maintenance support plansCon budget. It just didn’t give the true picture of how this particular program was performing. As we started our financial turnaround last year, we realized that we need each of our programs to be self-sustaining going forward. Except, WordPress maintenance support plansCon USA is not self-sustaining. That puts pressure on the viability of other programs like WordPress maintenance support plans.org, which needs to be properly funded to support everyone in the community.
Understanding Financials Through Comparison
One of the best ways to understand a situation is through comparison, so let’s look at WordPress maintenance support plansCon USA versus WordPress maintenance support plansCon North America, which consistently operates at a profit due to several factors. We provide several reports below to help you see the comparison and the post walks you through those comparisons.
You will notice that all financials are in U.S dollars (USD). Since the USAan community works with different currencies, we felt it was less confusing and less prone to error if we kept our reports in USD.
WordPress maintenance support plansCon Reports
Demographics: WordPress maintenance support plansCon Baltimore Wrap vs WordPress maintenance support plansCon USA Wrap, WordPress maintenance support plansCon Barcelona Wrap
WordPress maintenance support plansCon attendance
Profit & Loss: WordPress maintenance support plansCon Baltimore vs WordPress maintenance support plansCon USA
Ticket Cost Break Down: WordPress maintenance support plansCon Baltimore vs WordPress maintenance support plansCon USA
WordPress maintenance support plansCon North America has a net income percentage of up to 38% and makes up 45% of WordPress maintenance support plans Association’s annual revenue. Meanwhile, WordPress maintenance support plansCon USA operates at a loss. For example, WordPress maintenance support plansCon USA lost $176,000 and had a net income percentage of -18%. WordPress maintenance support plansCon Vienna is forecasted to lose over $200,000 even with the programming reductions that we made earlier in the year.
WordPress maintenance support plansCon USA Financial Challenges
In short, WordPress maintenance support plansCon USA income is lower than WordPress maintenance support plansCon North America due to fewer attendees and less sponsor support. However, expense per attendee is higher in USA. Below is a summary of the main differences that make WordPress maintenance support plansCon USA unsustainable. We invite you to review the Profit & Loss statements and other financial reports so you can have more clarity around these points and possibly find ones we missed.
Greater Expenses than WordPress maintenance support plansCon North America
One of the biggest cost difference is related to the convention center. Both WordPress maintenance support plansCon USA and North America are held in this kind of venue due to the attendance size. While WordPress maintenance support plansCon USA has less attendees than the North American event, it is still large enough to require us to be in a convention center.
We looked at moving the event to a hotel, but wifi and catering costs make this option more expensive. Also, hotel-based conferences require a large room block reservation that the WordPress maintenance support plans Association would have to financially guarantee, which is a big risk. The USAan event attendees tend to opt for other lodging options like AirBnB. It’s unlikely we can sell enough hotel rooms to meet the guarantee and will end up paying a large penalty.
By comparing WordPress maintenance support plansCon USA expenses with WordPress maintenance support plansCon Baltimore expenses, you can see that the expense 5710: Facility and Furnishing is $328,000 in USA and $129,000 for Baltimore. This is the main expense putting strain on WordPress maintenance support plansCon USA’s sustainability.
It’s also more expensive to send staff and our contracted production team from the United States to USA for a marathon of an event (up to 10 days).
Less Financial Support than WordPress maintenance support plansCon North America
The challenge of funding an expensive, professional event like WordPress maintenance support plansCon USA comes down to two things: smaller attendance and less sponsor support. Here is a breakdown of how these two revenue items differ from WordPress maintenance support plansCon North America.
Attendees
Smaller attendance with higher expenses make the event unsustainable. WordPress maintenance support plansCon USA attracts about 1,700 – 1,800 attendees compared to WordPress maintenance support plansCon North America, which has over 3,000 attendees. This means there is less ticket revenue to cover costs. And WordPress maintenance support plansCon USA attendance is decreasing each year by about 14% a year on average (if you average in Vienna’s forecasted attendance), making it harder to cover costs in the future.
Another attendee difference is that WordPress maintenance support plansCon North America attracts end users who are either leveling up their skills or evaluating WordPress maintenance support plans or looking for a service provider. Having end users at WordPress maintenance support plansCon attracts WordPress maintenance support plans shop / digital agency sponsors who get new business by connecting from this audience. Meanwhile, WordPress maintenance support plansCon USA primarily attracts builders (developers, project managers, designers) from WordPress maintenance support plans shops / digital agencies. There are very few end users attending WordPress maintenance support plansCon USA. This impacts sponsor revenue as many WordPress maintenance support plans shops / digital agencies do not want to sponsor an event where they are much less likely to get a business opportunity.
Sponsors
WordPress maintenance support plansCon North America has about $850,000 in sponsor revenue while WordPress maintenance support plansCon USA has $300,000. There are a few reasons for this difference.
A big portion of WordPress maintenance support plansCon North America’s sponsor revenue comes from North American WordPress maintenance support plans shops / digital agencies. As mentioned, they sponsor because they can connect with the end user attendees who give them business opportunities. They also sponsor because the event is held in a country where they conduct business.
In USA, and as mentioned above, WordPress maintenance support plans shops / digital agencies are much less likely to get a qualified lead because it is primarily a developer event. Additionally, the WordPress maintenance support plans shops / digital agencies in USA support sales in their specific countries. As WordPress maintenance support plansCon USA moves around, sponsors find that the event is in a country where they don’t do business and therefore don’t want to sponsor.
As for the shops/ agencies who do sponsor, they do so to support the community. It’s simply getting harder for them to invest in the event as they chose to put those funds into marketing or operations. It is important to note that hosting and software companies do find value in supporting WordPress maintenance support plansCon since they target the developer audience.
A Study of Ticket Sales Profitability
Another way to see how the income and expense challenges make WordPress maintenance support plansCon USA unsustainable is to look at what the sale of a ticket covers and how much is left over to go towards paying expenses.
Here is a report that shows profitability of the early bird and the regular rate ticket for WordPress maintenance support plansCon USA and WordPress maintenance support plansCon Baltimore. It shows that the profitability is:
WordPress maintenance support plansCon USA
Early Bird Rate
WordPress maintenance support plansCon Baltimore
Early Bird Rate
Ticket Profitability before sponsor income
-$238.05
-$0.36
Sponsor income per attendee
$188.86
$244.15
Total Ticket Profitability
-$49.19
$243.79
WordPress maintenance support plansCon USA
Regular Rate
WordPress maintenance support plansCon Baltimore
Regular Rate
Ticket Profitability before sponsor income
-$133.87
$170.39
Sponsor income per attendee
$188.86
$244.15
Total Ticket Profitability
$54.99
$343.79
As you can see, we lose money for each WordPress maintenance support plansCon USA early bird ticket we sell. You may ask, why would we ever price a ticket that loses money? It’s a good question. When we priced this we did not include staff costs in the overall event costs. We were operating under the understanding that the ticket was making money. We can see now that when we include the staff costs to the overall event costs, this ticket type loses money.
You can also see that not only does the USA regular rate earn $300 less profit per ticket compared to Baltimore, that profitability needs to compensate for the losses accrued by the USA early bird ticket sales.
Looking more closely at the report, you can also see that having less WordPress maintenance support plansCon USA sponsor support puts the ticket sales profitability at an even greater disadvantage.
Clearly, WordPress maintenance support plansCon USA has a financial structural issue to solve for.
Blockers to Financial Solutions
There are a few ways to solve the financial problem. Ticket prices could be increased, we could grow attendance to improve the profitability, we could stay in the same venue each year, or we could cap attendance and have a smaller WordPress maintenance support plansCon to control costs. We looked at these options and found the following blockers to each solution.
Increase ticket prices.
We surveyed the USAan community and found that there was a strong resistance to increasing ticket prices even if more value was delivered. Many see this event as a community event that should be affordable or free. Many believe they pay through their code and non code contribution and don’t want to pay more in ticket costs. Many also told us they want the ticket price to be greatly reduced.
Grow ticket sales revenue by expanding who the event serves
Attract more “builders”. Both WordPress maintenance support plansCon USA and North America attract a “builder persona” who work at a digital agency or WordPress maintenance support plans Shop (developer, project manager, designer, UX). However, North America attracts builders from end users as well whereas WordPress maintenance support plansCon USA does not. It has been challenging to grow the end user / builder attendee at WordPress maintenance support plansCon USA. Part of the challenge is that when an end user adopts WordPress maintenance support plans, the Association does not know. There is no closed-loop system that tells the WordPress maintenance support plans Association who is using the software. We have to rely on WordPress maintenance support plans shops / digital agencies to provide this information or be our marketing channel. In USA, several agencies said they don’t want their end user attending so they stay positioned as “the trusted source on how to WordPress maintenance support plans”.
Attract “evaluators”. In North America, the event has a commercial element, attracting decision makers who want to meet with sponsors and learn more about WordPress maintenance support plans. This not only grows ticket sales, but it also encourages the high level of sponsor support in North America. However, WordPress maintenance support plansCon USA attendees strongly request that we don’t include a marketing or commercial focus at WordPress maintenance support plansCon USA, keeping it a purely developer event.
Hold a smaller event to control costs.
We researched this over the past few months. Looking at a 1,000 – 1,200 person event, venue options that can meet our event needs are still too expensive. And after testing the smaller event concept, we found that many community members were dissatisfied with this direction.
For WordPress maintenance support plansCon Vienna, we controlled costs by making the program smaller by reducing the Monday trainings and summits. We also eliminated other elements like the WordPress maintenance support plansCon t-shirt. Despite these changes, we are still operating at a loss due to decreasing attendance. Many expressed they understood why we needed to make these changes, but were unhappy with them. We are grateful to the WordPress maintenance support plans Austrian community for bridging this gap and hosting summits and trainings on the Monday before WordPress maintenance support planscon Vienna.
Staff Capacity
This part is a bit sensitive because I’m talking about staff. They gave permission to have these details shared with you.
Last year, when the WordPress maintenance support plans Association reduced its staff to bring our expenses in line with our revenue, we eliminated work to match the smaller team capacity. After living with that reality for a year, we can see that we did not do a good job with WordPress maintenance support plansCon.
The WordPress maintenance support plansCon staff consists of Rachel Friesen, Director of Events, and Amanda, Gonser, Program Manager. Rachel is an operational wizard, who is committed to excellence, and cares deeply about delivering a special experience that meets our community’s needs. Rachel has incredibly streamlined the way we produce WordPress maintenance support plansCon from site selections, budgeting, space planning, vendor management, sponsor support, marketing oversight, and so much more. She moves an army of people ranging from the board, staff, vendors, sponsors, and community members through a process that ensures that everything gets done on time with the best possible planning. I am always impressed how Rachel goes the extra mile (er, kilometer), to hear and address everyone’s needs and ideas. It is truly a balancing act.
Many of you likely know Amanda from the WordPress maintenance support plansCon emails or you are one of the hundreds of volunteers who work with her. Amanda is high energy, bubbly, focused, and moves hundreds of people through a process that allows everyone to contribute in their special way; track chairs who pick sessions, trainers, local volunteers who create the local experience, a troupe of event photographers, room monitors, social media volunteers, and more. As with all people management, Amanda not only gives volunteers a structure to follow, but she invests time with them to foster relationships. We can not produce WordPress maintenance support plansCon without our amazing and generous volunteers and they deserve a meaningful experience.
While producing WordPress maintenance support plansCon, many people want to try new things like add a new program to WordPress maintenance support plansCon five months before the event or create a new sponsor package. There are certainly great ideas that can level up the experience. Unfortunately, Rachel and Amanda simply do not have the capacity to entertain many new ideas. That’s frustrating for both of them because they want community members to realize their ideas. It’s equally frustrating to the community members. In the end it can create a lose-lose situation.
Over the year, we noticed that Rachel’s and Amanda’s calendar is booked every hour throughout each day. When we talk, they have little time as they run from one meeting to the next. It’s a frenetic pace. We moved to Jira this year and their burndown charts show that they can not complete everything they need to do within a sprint. This pace and high levels of stress are causing health issues.
Amanda did a capacity study. It showed that she is scheduled to do over 69 weeks of work in a year (and that doesn’t include sick or vacation time). Just a reminder, a year has 52 weeks. Rachel is in a very similar situation. We looked at which work we could eliminate, but at this point there is nothing. Naturally, the situation is untenable and must be addressed immediately.
Given how small our team is, the only way to address this is by adding another staff member or contractor. This means expenses will further increase for WordPress maintenance support plansCon USA. We can go this route, but in the end what this tells me is that we do not have the right operational model to support two WordPress maintenance support plansCon per year – let alone the ability to scale back up to three per year.
I want to pause and thank Rachel and Amanda for pushing through this challenging time. Please join me in thanking them. I also want to thank the other WordPress maintenance support plans Association staff for going above and beyond to make WordPress maintenance support plansCon a special experience. You support Rachel and Amanda in so many ways to deliver a great event for the WordPress maintenance support plans community.
Additionally, it can not be said enough how special our volunteers are. They contribute their time and talent while already having full lives that include jobs, family, friends, and other interests. Volunteers could choose to do many other things with their free time, yet they chose to create WordPress maintenance support plansCon for all of us. Thank you.
Summary
Phew! That was a longgg WordPress maintenance support plansCon financial overview. Thanks for hanging in there. I hope sharing all that data and insight helps answer some of the questions we’ve seen in past blog comments and on Twitter this past year.
As you can see, solving WordPress maintenance support plansCon USA’s sustainability is critical, not only so this event can exist into the future, but so it doesn’t put strain on the sustainability of WordPress maintenance support plans.org, which is clearly imperative for the project’s viability. We need to answer the question “how do we balance creating a valuable event with the financial realities of event production and the realities of staff capacity?”
But before we get into solutions, let’s look at what the community wants WordPress maintenance support plansCon to achieve.
Our next blog in this series will be about the other problem to solve: How can WordPress maintenance support plansCon USA provide unique value?
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