Last month, Ryan Jones, a small-business owner in San Francisco, found himself making an unexpected plea to fellow merchants.
San Francisco Pride was in trouble and needed their help.
Mr. Jones’s business, a bakery called Hot Cookie, had never given money to the annual festival that celebrates L.G.B.T.Q. life. But when he heard that major companies like Comcast and Anheuser-Busch were not renewing their sponsorships, leaving a funding gap of more than $1 million, he felt compelled to act.
“I asked myself what I can do to support,” Mr. Jones said of the festival, which will be held June 28-29. One answer: He and his business partner pledged to donate 5 percent of sales from the bakery’s most popular cookies to this year’s event. Another: He would try to get other local businesses to do something similar.
Across the country, Pride events are struggling. Big corporations have been withdrawing funding for the festivals, part of a retreat from diversity initiatives that has increased under the second Trump administration. In response, local businesses are helping to make up some of the shortfall. Many see it as a way of standing up not only for L.G.B.T.Q. people, but also for what the annual celebration means for their local economies.
In San Francisco, Pride is a multimillion-dollar festival drawing hundreds of thousands of visitors, dozens of musical acts and hundreds of food vendors. The event, in turn, has become a powerful economic engine, bringing in an estimated $350 million in 2015, the last time the city conducted a study of its economic impact. Now, many local businesses, including hotels, restaurants, bars and retailers, are concerned about what it would mean if the festival had to be scaled back.
Hot Cookie, whose baked goods include provocatively shaped “sex positive” cookies, saw its sales increase 30 percent during last year’s Pride event, Mr. Jones said. He hopes that the support from local businesses like his, he said, will keep Pride “viable and healthy and vibrant.”
Twin Cities Pride, in Minneapolis and St. Paul, saw a decrease of $690,000 in corporate funding this year from a year ago. Deloitte, which had been a sponsor for four years, did not renew its sponsorship this year, said Andi Otto, the executive director of that event. And the festival cut ties with Target over the company’s retreat from diversity initiatives.
Donations from small businesses, individuals and nonprofits have nearly made up for that funding drop — the event is now $25,000 short of its $1.4 million goal.
“I think one of the biggest lessons learned is that small businesses definitely see the value and the need to support a community like ours,” Mr. Otto said. Those businesses collectively donated $93,000 to Twin Cities Pride this year, up from $25,000 in 2024. Next year, Mr. Otto expects to spend more time fund-raising from them.
Among these small donors is Becky McNattin, owner of a mental health care practice in Minneapolis. She said that her L.G.B.T.Q. patients were experiencing anxiety over Trump administration policies — including barring transgender people from serving in the military and asserting that the federal government recognizes only two sexes, male and female. Her “heartbreak” over their fears, she said, led her to commit $10,000 to Twin Cities Pride this year — five times what she contributed last year.
Ms. McNattin noted that having her therapy practice’s name displayed at the festival also exposed it to potential clients. A 2018 study found that Twin Cities Pride generated $13.4 million in economic activity. During Pride week last year, hotels in Minneapolis brought in more than $11.6 million in total revenue — their third-highest weekly revenue — according to the travel data firm Smith Travel Research.
Some see the renewed focus on small businesses as a return to the festivals’ roots. The first Pride marches were held in 1970 to commemorate the anniversary of the Stonewall riots, which erupted after the New York City police raided a gay bar in Greenwich Village. Throughout the 1970s and ’80s, Pride festivals were more ragtag marches, relying on donations from individuals and small businesses, particularly those with L.G.B.T.Q. ownership.
Their role was overshadowed in the late 1980s and ’90s, when major corporations like Absolut Vodka and IKEA sought to take advantage of the growing spending power of the L.G.B.T.Q. community, said Marc Robert Stein, a historian at San Francisco State University who specializes in U.S. social history.
As corporate sponsorships grew, Pride budgets expanded. San Francisco Pride, for example, aimed to raise $3.2 million this year, with $1.2 million covering just the cost of insurance, security and medical services. Other costs include paying staff members and performers and renting event spaces; this year, $200,000 is set aside for musicians performing on the main stage.
St. Louis’s Pride festival grew with the help of Anheuser-Busch, which sponsored the event for more than 30 years. But this year, the beverage giant, alongside several other companies, did not renew its support, leaving the festival with a $150,000 funding gap.
The corporate sponsorship model is “broken,” said Marty Zuniga, the president of Pride St. Louis. “Companies just aren’t writing those checks anymore. Their marketing directive has changed.”
To fill the void, Mr. Zuniga turned to other businesses in St. Louis. One of them, 4 Hands Brewing Company, is donating $1 for every case of light lager and American pale ale that the brewery sells.
Liz Swyers, chief marketing officer at 4 Hands, said her company’s decision to support Pride was about showing that there were small businesses willing to “speak up for what’s right and to support the people that live in St. Louis.”
The closer ties to local businesses may be the silver lining in the funding crisis, said Eve Keller, a president of the U.S. Association of Prides. “Getting deeper relationships with organizations that match your values, that won’t leave you when things get hard, I think that’s where we’re trying to build.”
It is also a welcome change, she said, for those who see corporate support for Pride as more about profits than equality for the community.
“The push against ‘rainbow washing’ has been underlying Pride for some time,” Ms. Keller said, adding that many people “are wanting to get back to the protest side of Pride because of the attacks on the trans and nonbinary community right now.”
The corporate retreat from Pride has been less of a blow to smaller parades, which have long relied on local partnerships.
“The bread and butter of our sponsorships is from medium to small businesses that are either based regionally or within the state,” said Jonathan Balash, president of the Pride festival in Spencer, Ind., which has a population of 2,500. This year, Mr. Balash expects Spencer Pride, which will be held in October, to meet its budget goal, with long-term sponsors like Boston Scientific and Owen County State Bank continuing to support the event.
Still, despite the potential of building closer relationships with local partners, the economics of large Pride festivals may not work without large sponsors, at least in the near term.
In San Francisco, which faced a funding gap of more than $1 million in March, the role that small businesses played in fund-raising was important. But large local corporations like Salesforce and Levi’s had the biggest impact in shrinking that financial hole to $180,000, said Suzanne Ford, the executive director of San Francisco Pride.
“I understand why somebody would want to go back to having a protest and march down Market Street,” Ms. Ford said. “I would much rather go ask good corporate partners for money and pay the queer performers and be the economic engine that San Francisco Pride is.”
Niko Gallogly is a Times business reporter, covering diversity and environmental and social justice efforts in corporate America. Email them at [email protected].
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