Confidential — for principal donors & institutional funders
Investor Appendix
Supporting detail behind the donor case: capital plan by phase, revenue build by stream, scenario assumptions, risk register, governance, and reporting cadence. Numbers reconcile to the liveFinancials page.
A. Capital plan by phase
| Phase | Window | Thesis | Base capex |
|---|---|---|---|
| P1 | Months 1–12 | Design, permits, recording studio, 200-seat intimate recital hall shell, and 3-classroom wing. Classes + studio billing from month 6. | $2.45M |
| P2 | Months 13–24 | Recital hall + classrooms OPEN. Ticketed series begins, fundraising events launch. Operating break-even target. | $1.60M |
| P3 | Months 49–60 | 600-seat outdoor amphitheater + spatial-audio sacred dome + acoustic hall upgrade. Funded by operating surplus + secondary capital campaign. | $3.08M |
| P4 | Months 25–36 | TV/Radio + podcast wing (extension of studio building). Tandon Distinguished Chair recruited once ops can carry the salary. | $1.05M |
| Total (escalated @ 5%) | $9.03M | ||
B. Line-item capex
| Item | Phase | Year | Amount |
|---|---|---|---|
| Architectural design, permits, civil & site prep | P1 | Y1 | $350K |
| Recording studio (build + gear) | P1 | Y1 | $450K |
| Classroom wing — 3 rooms + black-box rehearsal | P1 | Y1 | $750K |
| Recital hall (200-seat) — shell & foundation | P1 | Y1 | $900K |
| Recital hall — envelope, acoustic interior, MEP | P2 | Y2 | $850K |
| Recital hall — seating, FF&E, A/V, finishes | P2 | Y2 | $350K |
| Livestream / broadcast rig | P2 | Y2 | $180K |
| Opening-season programming runway | P2 | Y2 | $220K |
| TV/Radio studio build-out (extension of studio bldg) | P4 | Y3 | $650K |
| Podcast suites + control room (2 booths) | P4 | Y3 | $220K |
| Tandon Distinguished Chair — recruitment & setup | P4 | Y3 | $180K |
| Outdoor Pine Lake amphitheater (600-seat) | P3 | Y5 | $1.40M |
| Spatial-audio sacred-sound dome (build + system) | P3 | Y5 | $950K |
| Recital hall acoustic upgrade + rigging | P3 | Y5 | $380K |
| Construction contingency (8%) + commissioning | P3 | Y5 | $350K |
C. 5-year operating projection (base case)
| Year | Revenue | Costs | Net ops | Capex | Tranche in | Cum cash |
|---|---|---|---|---|---|---|
| Y1 | $503K | $583K | $-80060 | $2.45M | $1.50M | $-1030060 |
| Y2 | $2.08M | $1.42M | $661K | $1.68M | $1.50M | $-549467 |
| Y3 | $3.72M | $2.33M | $1.38M | $1.16M | $1.50M | $1.18M |
| Y4 | $5.00M | $2.89M | $2.11M | $0 | $1.50M | $4.79M |
| Y5 | $6.63M | $3.60M | $3.03M | $3.74M | $1.50M | $5.57M |
Operating break-even: Year 2.
D. Key assumptions
- Lead pledge: $7.5M paid in 5 equal annual tranches of $1.50M. The pledge was re-sized from an initial $5M after modeling showed a $1.16M Y1 cash gap against $2.45M of Phase-1 capex; flat $1.5M tranches shrink the Y1 gap to roughly $660K (closed by end of Y2) and keep cumulative cash positive from Y3 onward.
- Cost escalation: 5% per year applied to capex from Y2 onward.
- Class economics: $450/month × 2 sessions × 8-week cohorts; ramp from 5 sections in Y1 to 24 by Y5.
- Hall opens end of Y2; first full ticketed season in Y3.
- Tandon Chair deferred to Y3 to preserve Y1–Y2 runway.
- Amphitheater + spatial-audio dome funded from retained surplus in Y5, not from the lead gift.
E. Risk register
| Risk | Likelihood | Impact | Mitigation |
|---|---|---|---|
| Construction cost overrun | Medium | High | 10% escalation reserve; phased build defers $3.7M to Y5 |
| Class enrollment shortfall | Medium | Medium | Temple-network marketing; corporate L&D and afterschool channels |
| Artistic director recruitment delay | Low | Medium | Part-time interim in Y2; full search Y3 |
| Major donor concentration | High | High | Active prospect pipeline of 36 named families + foundations |
| Hall utilization < 60% | Low | Medium | Rental, streaming, and rehearsal-block revenue absorbs gap |
| Regulatory / 501(c)(3) timing | Low | Low | Fiscal sponsorship via HUA during interim |
F. Governance & reporting
- Center operates as a program within HUA's 501(c)(3); separate restricted fund accounting.
- Donor-named Advisory Council with quarterly review of financials and programming.
- Annual audited financials; semi-annual narrative + KPI report to the lead donor.
- Tranche release tied to milestones: design complete, classroom wing CO, hall opening, etc.