Hollywood’s blockbusters, which generally run for only 10 weeks at no more than $20 a ticket. This explains how Universal Studios, the largest movie studio in the nation with hits such as "Jurassic Park" and "E.T." has profited more from "Wicked" on Broadway than from any other venture in its 100-plus year history. In short, the potential for profits are not only staggering, but can last a lifetime.
4. Tours, and Licensing, and Merch, Oh My! (Subsidiaries)
As profitable as shows on Broadway can be, Broadway tickets only account for a fraction of what a production grosses in total. On top of the Broadway production, shows often go on tour, open in other major cities, sell movie rights, sign licensing deals, and release merchandise. Over the past 10 years, touring shows have earned more in annual gross ticket sales than their counterparts on Broadway. And the market for these shows isn’t just in the U.S. – the world loves Broadway. "Kinky Boots," which opened on Broadway only three years ago, is preparing to mount its sixth production worldwide, with locations including London, Australia and South Korea. Each of those productions will funnel money into investors who are already seeing very healthy profits from the Broadway run. Subsidiary productions can even save a show that was unable to profit on Broadway. "Seven Brides for Seven Brothers," for example, closed after only three performances on Broadway in 1982, seemingly losing everything for its investors. By 2000, however, the show had recouped from licensing stock and amateur rights, and is now turning a profit.
5. Let Me Entertain You (Fun)
Though we all want our investments to deliver returns, a significant majority of Broadway investors are satisfied whether or not they make money, and continue to invest on Broadway. On top of fiscal incentives, investing in Broadway is just plain fun. Investors get exclusive perks like tickets to opening night, parties with stars of stage and screen, invites to industry events, and, for larger investors, even eligibility to win a Tony Award!
Now you know why I’m in this business, but the problem still stands that only 25 percent of shows are able to reap the rewards outlined above – or so conventional wisdom states. The truth is that if you know your way around the industry, you can significantly increase your chance of success. That is where I come in. Before I bring investors into a show, I do an in-depth analysis of the product, the environment, the market, and the financials. Based on this information, I determine if the show has a decent shot at being one of the few winners. With the requisite knowledge and understanding, you can turn investing in Broadway into a powerful tool to make significant returns for many years – precisely what OHenry Productions attempts to do with its investors.
Growth & Funding Strategist