While in business school, I was able visit 20 west coast companies within a week’s span. These companies included social media behemoths, search engine empires, budding start-ups, and even a couple venture capital firms. On this trip, we had the great fortune of meeting with BC alumnus Peter Bell, a general partner from Highland Capital Partners, a tremendously successful venture capital firm that partners with entrepreneurs developing technologies to disrupt massive markets. And it was during this presentation that I began to clearly see the parallels between the thought process of an accomplished venture capitalist and the strategies of a good Broadway producer/investor.
During our visit, Peter gave us an insider’s perspective into what he looks for when investing in a company. Each of his criteria, ranked in his order of importance, should also be used by producers and individual investors to evaluate commercial theatre projects.
During our visit, Peter gave us an insider’s perspective into what he looks for when investing in a company. Each of his criteria, ranked in his order of importance, should also be used by producers and individual investors to evaluate commercial theatre projects.
Company Team: Bell believes ”it’s better to have an exceptional team behind an average idea than an average team behind an extraordinary idea.” Only a talented company team can bring a company to liquidity.
On Broadway, it is important to pay attention to both the producing and creative team behind the show. After all, you want to be working with a winner. Below are a few stats to look for:
On Broadway, it is important to pay attention to both the producing and creative team behind the show. After all, you want to be working with a winner. Below are a few stats to look for:
- How many Tony Awards and nominations have the director, designers, and actors racked up?
- What is the hit to flop ratio of this team (both critical and financial)?
- What are the strengths of the producers – lean budgets, marketing, public relations? And to what success have these producers run past Tony campaigns?
Competition: Bell advises “Only invest in a company that you believe can be the number one or number two in the space.”
Theater, like any other industry, must be aware of competition. Questions to ask:
Recently, when speaking with one of the industry’s most successful lead producers, I inquired why he planned to revive a particular classic comedy this year. His answer was simple: “I like this play and there are no other comedies coming out this season.” With no competition, this work has the potential to thrive.
Each season, only a handful of Broadway productions to exceptionally well. You better make sure your show can hold its own against to the competition to wind up on top.
Theater, like any other industry, must be aware of competition. Questions to ask:
- Are there other plays or musicals opening this season that:
- Fall into the same genre
- Target the same audience demographics (age, gender, etc.)
Recently, when speaking with one of the industry’s most successful lead producers, I inquired why he planned to revive a particular classic comedy this year. His answer was simple: “I like this play and there are no other comedies coming out this season.” With no competition, this work has the potential to thrive.
Each season, only a handful of Broadway productions to exceptionally well. You better make sure your show can hold its own against to the competition to wind up on top.
Product/Service/Idea
At the end of the day you want to produce or invest in a work you think is good. Like in other markets, your show should fulfil a need and have a point of differentiation.
Financials and General Economy
Commercial Theater is a business and the financials have to look promising. Before committing to a project examine:
At the end of the day you want to produce or invest in a work you think is good. Like in other markets, your show should fulfil a need and have a point of differentiation.
Financials and General Economy
Commercial Theater is a business and the financials have to look promising. Before committing to a project examine:
- Total Capitalization
- Weekly Operating Costs
- Recoupment Schedule (and note ticket price, capacities, etc.)
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