Dear Lucidity Community,
We are writing to you today with a desire to provide a clear and transparent picture of Lucidity Festival’s current realities we are navigating. Our earlier statement that simply stated we aren’t in a position to offer refunds at this time was hasty and incomplete. Our apologies for not being more clear. We hope that the following detailed information will answer many of the questions that have emerged.
For years, this festival has been a labor of love, driven by our passion for creating spaces where magic happens, connections are made, and creativity thrives. For those of you who have been paying attention over the years, you are aware that we have been financially challenged for some time and the situation has now reached a critical impasse.
Lucidity Festival began as, and still is, a grassroots, cooperatively owned venture, bootstrapped from ticket sales in our very first year. None of the owners had startup capital. This means revenue from ticket sales are used to produce the upcoming event. For over a decade, we’ve followed this model and operated at the same venue with a max capacity that has limited our ability to grow, even as production costs have steadily increased - as much as doubling after COVID.
Despite these challenges, we have always prioritized the quality of your experience, even if it meant sacrificing our own compensation and financial stability as directors and managers. We were committed to ensuring that employees and contractors always got paid in accordance with their agreements, even in years that were losses, and the company took on debt to do so.
The following timeline of setbacks have compounded to contribute to our current financial difficulties:
- 2020-2021: The pandemic forced us to cancel our events, dealing a blow to our momentum and finances for multiple years.
- 2022: We lost access to imported bamboo, a key material for our stages and structures. Not only was our investment lost but we had to rent replacements.
- 2023: Severe weather and complications with off-site parking led to a substantial financial loss.
- 2023-2024: Our event insurance company denied the majority of our claim for losses associated with mitigating cancellation of our 2023, leaving us without the substantial dollars we needed to recoup our losses.
- 2024: Just weeks before this year’s event, new requirements from the fire department never faced before in our 10+ years of working with the County, made it impossible to secure our permit and forced us to postpone at the last minute.
- 2024: Refund requests received after postponement exceed the amount of money we have liquid in the bank.
The most recent postponement, coupled with the subsequent wave of refund requests that came in its wake, has hit us harder than we could have anticipated. When we announced the postponement and new venue in early June of this year, we hoped that refund requests would mirror what we saw during our COVID postponement—a small percentage of ticket buyers. At that level, we would have been able to fulfill them and move forward.
However, this time, a far greater percentage of ticket holders requested refunds, exceeding the funds we have available. It is understandable that people wanted refunds given this economy, and nonetheless it was crippling to us. Much of the ticket revenue that came in had already been spent on production costs for the 2024 event. Many deposits were made for artists and services and the majority of these expenses are non-refundable and Lucidity is unable to recoup them.
To fully understand what money was spent on consider this list:
- Musical Artist Deposits
- Pay for Employees and Contractors
- Marketing Expenses
- Office and Storage Rent
- Materials and Supplies
- Production Costs for Stages and Equipment
- Online Platforms and Back-end Subscriptions
- Workers Comp
Finally, consider that since we had to postpone with only 4-weeks to go until the event, we did not receive the large percentage of overall revenue that always comes through in the final weeks. Additionally, we had not obtained event cancellation insurance for our 2024 event by the time the postponement happened. Even if we had obtained a policy, the circumstances that caused us to postpone would not have been covered.
Thus, since refunds requested exceed the amount of money we have, we find ourselves at a crossroads with two (or more) possible paths forward:
- Finding an Angel Investor: We have been tirelessly seeking an investor who can help us set our sights on Lucidity 2.0. The Directors, co-owners, and a network of supporters have explored every partnership and opportunity we could find. Unfortunately, we have not yet found the support we need to continue. However, this option remains our hope for keeping Lucidity alive and bringing our community back together. We are looking for an angel that knows and loves what we’ve done over the last decade, wants to see it continue, and also sees the financial viability that is possible at Lake San Antonio with the capacity to grow that we’ve never had before at Live Oak.
- Filing for Chapter 7 Bankruptcy: If we are unable to secure an investor, or come up with some other creative solution, we will be forced to fold and file for Chapter 7 Bankruptcy. This would mean a third-party Trustee would take over our accounts, liquidating our assets and distributing all remaining funds to creditors, including ticket buyers, vendors, and lenders. While this process may result in some level of returned funds, it will take time and involve an in-depth examination of our finances.
- Other Creative Solutions: If there is something we haven’t thought about, we welcome all ideas from the community and encourage you to send to in**@lu**************.com .
We are doing everything in our power to act in a way that is fair and considerate to everyone involved. We are also exploring a few creative options to bring value to ticket buyers that may be a solid way forward, but we need time to work the details out.
Thank you for your understanding, your support, your patience, and for being a part of the Lucidity Family. Our hope is that the 10+ years of service to the community, and our decades long track record of integrity with agreements are remembered and weighed in your heart against this unfortunate current reality that exists as a compounding result of multiple unavoidable external forces.
Lucidity is run by a council of co-owners. As such there are strong systems of checks and balances in place, and our books are clean. There are no bad actors here, just bad circumstances. Thank you for trusting in us that we are doing our absolute best to arrive at beneficial outcomes for all creditors, including ticket buyers, vendors, and lenders.
If there are stretches of radio silence, please know it is because we are heads down working diligently, unpaid, trying to arrive at solutions. It’s challenging to engage in all the social media swirl, and it distracts us from the mission at hand. We will continue to keep you informed as we navigate these challenges via updates like these.
With deep humility and respect,
Lucidity Directors
