Two years ago, when the hard-charging New York import Chay Yew took the helm at Victory Gardens, the Lincoln Park theatre was in crisis. Subscriptions were dwindling, debt was rising, and the beloved longtime artistic director Dennis Zacek was leaving after a string of well-publicized disagreements with the theatre’s board.

Certainly the North Side stalwart—a Tony winner and launch pad for three decades of Chicago playwrights—wasn’t alone in its postrecession struggles. According to a 2009 study conducted by Theatre Communications Group, the leading national theatre advocacy organization, about half of the nation’s theatres were facing budget deficits, thanks in part to drops in corporate and foundation funding. Another study that same year by Grantmakers in the Arts sounded the alarm for midsize organizations in particular: They have high fixed costs yet less cash than their larger nonprofit siblings.

Because Victory Gardens spent around $11 million to acquire and renovate the Biograph space in 2006, its reserves were already stretched thin. And the theatre’s new-works mission precluded staging potential box-office bonanzas of classics-with-stars, à la Brian Dennehy and Nathan Lane in The Iceman Cometh at the Goodman last year. In 2011, Victory Gardens posted revenues of just under $2.5 million against about $3.4 million in expenses.

The task of pulling the venerable organization out of its slump wouldn’t be just difficult, but herculean. “I didn’t realize there was [a budget crisis] when I accepted the job,” says Yew. “The question became how to resolve it.”

The Singaporean-born playwright, 48, didn’t know much about balance sheets and board meetings. He had spent most of his career writing critically acclaimed plays, such as Porcelain, and was a founding director of the Asian Theatre Workshop in Los Angeles. Yew’s unorthodox résumé, however, was exactly why the board hired him. “We wanted to connect with the next generation of audiences and playwrights,” says Steve Miller, a venture capitalist who is president of the Victory Gardens board.

“They [said] that we needed to change,” says Yew, who has a wry wit and an ability to leap nimbly from topic to topic in conversation. He asked himself: “How do we do it gradually, and who is going to come along the way and who isn’t?”

Since coming aboard, Yew has made a series of controversial moves. In February 2012, he shelved the theatre’s original 14-person ensemble of playwrights (he granted them alumni status) and announced a new group of writers two months later. His ensemble was young and diverse and included the poet and playwright Marcus Gardley as well as Tanya Saracho, the founder of Chicago’s all-Latina company Teatro Luna, who is also currently writing for HBO.

Yew also made the tough decision to cut the number of plays in the theatre’s 2013–14 season from the usual five to just three. “You want to do things that could really engage you artistically, but you can’t go on if you incur debt,” he says ruefully.

With managing director Christopher Mannelli, he also inaugurated a new resident theatre series offering cutting-edge companies below-market rent in the hope that they would bring in cash and cachet. The goal is getting closer to younger audiences, the holy grail sought by every arts organization in an age of declining subscriptions.

So far, results have been good. Victory Gardens had a slam dunk this past spring with The Whale by Samuel D. Hunter, one of its new playwright ensemble members. (The Tribune’s Chris Jones called it one of the best plays of 2013.) Subscriptions are up: 77 percent of patrons renewed this year, just above the national average. Miller projects that the theatre will break even this year.

A balanced budget is just the first step. “It’s going to be slow and hard for Victory Gardens,” says Deb Clapp, the executive director of the League of Chicago Theatres. “But change is a good thing for any company.”

Given the tumultuous transition, Yew admits that it has taken time to feel settled. “For the first time, last year it felt like we could breathe a little,” he says.

The real test of his vision will come this season, the first that puts many of his changes into effect. It kicks off this month with Appropriate, a play that is, fittingly, about legacy (see “Risky Business,” below). “It’s not just about my generation anymore,” Yew says. “What is the next generation listening to?”

Risky Business

Central to Victory Gardens’ turnaround formula: a more diverse mix of playwrights and stars

Appropriate

Buzzed-about playwright Branden Jacobs-Jenkins’s story of siblings squabbling over their father’s legacy and secrets. Directed by Gary Griffin.
November 8 to December 8

The Gospel of Lovingkindness

Marcus Gardley takes a piercing look at gangs, guns, and gentrification in Bronzeville.
February 21 to March 23, 2014

Death and the Maiden

Sandra Oh (Grey’s Anatomy) stars in Ariel Dorfman’s 1990 play about a woman convinced her husband’s dinner guest tortured her during a political revolution years earlier.
June 13 to July 13, 2014