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* Home * Blog Menu * Home * Blog Facebook-f Twitter Instagram INVESTING IN THEATER If you’re thinking about investing in Broadway, here are a few things you should know. Broadway investing comes with many perks that can be extremely beneficial for those looking to get involved in the theater industry. From being part of a show’s developmental process to getting access to premium tickets and backstage tours, investing in Broadway can be a great way to get insider knowledge and insight into the industry. And of course, if the show is successful, investors may see profits on their investment. So if you’re interested in learning more about Broadway investing, read on for more information. The first perk of investing in Broadway is that you get to be part of a show’s developmental process. This means that you get to see a show from its inception all the way through to opening night. You’ll be able to attend rehearsals, meet the cast and crew, and get an inside look at how a Broadway show comes together. This is a great opportunity to learn about the business of theater and to get a feel for what goes into making a successful production. Another perk of investing in Broadway is that you’ll have access to premium tickets and backstage tours. This means that you’ll be able to see shows before they open to the general public and you may even be able to get tickets to sold-out shows. You’ll also be able to take backstage tours of the theater where you can learn about the history of the building and see how the inner workings of a Broadway theater operate. This is a great way to get an up-close look at the inner workings of the theater industry. If you’re thinking about investing in the entertainment industry, you need to know about the potential for recouping your investment. Statistically, about 20% of Broadway shows recoup their money, but if an investor loses money on four shows, they may still make their money back on one successful show. Broadway is a notoriously risky investment, but some shows do better than others. In fact, according to Crain’s New York Business, “Wicked has not only thrived for 10 years, but it also has rewarded its investors with a return of more than 1,000%.” Of course, not every show is going to be a Wicked-level success story. But if you’re smart about which shows you invest in, you have a chance to make some serious money. So if you’re looking to take a risk on Broadway, do your research and pick your projects wisely. With a little luck, you could see a fantastic return on your investment. So you’re thinking of investing in the entertainment industry? Broadway is a risky investment, but it can also be incredibly lucrative. Some people invest in Broadway for the love of the arts. Some people invest for the chance of a big return. Some invest knowing there is a good chance they will lose their money, but they’ll get so much out of the perks that it pays for itself. Some invest to enjoy the process and are happy getting some or all of their money back if the show does well, or potentially much more if the show recoups its investment and is profitable. WHO CAN INVEST IN BROADWAY SHOWS? Are you interested in investing in Broadway shows? The SEC has regulations to help protect your investment. Here are the basics: an accredited investor, in the context of a natural person, includes anyone who: a) earned income that exceeded $200,000 (or $300,000 together with a spouse) in each of the prior two years, and reasonably expects the same for the current year, OR b) has a net worth over $1 million, either alone or together with a spouse (excluding the value of the person’s primary residence). If you fit these criteria, Broadway investing may be a great way to boost your portfolio. While Broadway shows are mostly limited to those who are accredited investors, there are investment groups and wealth managers that organize funds to invest in shows. With the recent JOBS (Jumpstart Our Business Startups) Act, you can now invest in other types of theatrical shows, including in the enormous entertainment market of Las Vegas. The pioneer in Las Vegas (other than Bugsy Siegel!) is a company called Fan Rebellion. WHAT IS THE MINIMUM TO INVEST IN A BROADWAY SHOW? If you’re thinking of investing in a Broadway show, most Broadway shows require a minimum investment of $25,000 from their investors. However, some shows may require less – as low as $5,000. Producers usually need to raise anywhere from $150,000 to $250,000 or more in order to fund the production. You could potentially team up with another investor and split the investment cost if the minimum share for a particular show is too pricey for you to invest on your own. For example, if a Broadway show requires investors to pay $25,000 per share, some shows will permit two people to come in together and split that amount to claim an investor share. Doing this could be a great way for you to still invest in the show you’re interested in without having to bear the entire cost by yourself. You should be aware that most shows are funded by a large team of co-producers. A show may have a total capitalization of $5 million to over $10 million, with many co-producers who raise $500,000 each. The producers often split the profits with the investors after the total investment has been recouped. If you are looking to invest in entertainment, then this is something you should keep in mind. There are still options available to you if you’re not an accredited investor or don’t have a lot of money to spend on an investment. You could look into crowdfunding platforms that focus on Broadway and theater productions. These platforms allow people to invest smaller amounts of money in exchange for equity in the show. There are very few established theatrical companies using the crowdfunding platforms, but this one in Las Vegas is creating a diverse portfolio of entertainment offerings and is allowing investors to start with as little as $105. WHAT IF I AM NOT AN ACCREDITED INVESTOR OR WANT TO INVEST A SMALLER AMOUNT? HOW DOES SOMEONE GET TO INVEST IN A BROADWAY SHOW? There are several opportunities every year to invest in a Broadway show, but most of these investment opportunities are not advertised publicly and are offered privately by lead producers to their inside group of trusted co-producers and investors. Keep in mind that many investors and co-producers connect through relationships, so getting to know lead producers is essential if you want to get in on the action. Who knows, you might just end up with front row seats to a Tony Award-winning show! HOW DO I MAKE MY MONEY BACK IN THEATER? You may be wondering how profits are distributed. Every show is different, but the general idea is to pay the investors back first, and then all of the producers share in the profits of a successful show. Broadway shows typically have an “investor pool” and a “producer pool.” A profitable show will typically split 50/50, with 50% going to the investor pool and 50% going to the producer pool. The profits are then split within each pool based on the shares in each pool. If the show is not successful, you may lose your investment, or at least part of it. Luckily, you should not be responsible for losses beyond what you invested. But this is where you also need to make sure that you have good legal advice before signing any agreements as an investor or producer. Why Invest In Broadway? There are many reasons why people invest in Broadway and theater year after year. Here are some of the most common motivations: * To support the arts * Diversify a portfolio with high risk/high reward investments * Meet others with similar interests * Enjoy watching a show develop from beginning to end * Access to VIP events, Opening Night tickets, and more * Eligibility to receive a Tony Award Each investor has different reasons for putting money into Broadway, but all are united by their love of theater. Investing in Broadway is a unique and exciting way to show support for the arts while also potentially earning rewards. HOW LONG DOES IT TAKE TO MOUNT A SHOW? It typically takes between four and six months to mount a show in Las Vegas. This includes time for planning, coordinating, rehearsing, and opening night. There are a lot of moving parts that need to come together in order to make a successful production, so there isn’t much room for error. But there is more to the process than physically making the show happen. You need to have enough time to market your show, so you can sell advance tickets. The window for advance-marketing is constantly changing, especially in Vegas, which relies on tourists from all over the world. The pandemic has made potential ticket buyers wary of purchasing too far in advance, because they have experienced many shows and concerts (and flights!) getting canceled due to Covid-related concerns. At the time of the writing of this article, the trend is for most ticket sales to happen in the three weeks preceding the date of the show. There are a myriad of other factors that will affect the date of an opening night, including seasonal tourism and the schedule of celebrity performers (if applicable). THE PERKS! Let’s face it, this is why you are investigating this investment opportunity! Theatrical investing brings many perks, many of which are arguably worth the cost of losing your investment, in the event that the show is not successful. Common perks include: Opening night and preview tickets Access to VIP house seats Opening night party Rubbing elbows with the show’s celebrity stars Rights to invest in Broadway tours and cast recordings Meet-and-greet with the cast Exclusive merchandise Getting the title of “Tony-award-winning producer” Great networking opportunities Getting an inside view of the entertainment community and how shows are made If you are ever interested in investing in a Broadway show, there are great resources out there, whom we’d love to connect you with. Feel free to contact us for more information! YOU CAN GET IN ON THE FUN If all of this intrigues you more than it scares you, and you want to learn how you can dip your toe in the water as a Vegas producer, then check out Fan Rebellion. As a fan-owned live production company, they are allowing investors to participate for very small amounts of money. GET OUR NEWSLETTER Name Email Submit © 2022 | ALL RIGHTS RESERVED