Investing in theatre is a lot like putting your money on a horse. It's a high risk venture that will not (or should not!) appeal to most sensible investors. Investors are usually fairly rich with strong ties to the theatre or a passion for a certain playwright or performing group. In most cases, investors will not see a return on their initial capital. If they do, returns are likely to be small and probably non-existent for the first year! There is however the small element of chance that you may pick a winner but to do this, you will need an awful lot of luck!
The best way to begin investing in theatre is to write to the producers of a play you admire and ask about their forthcoming projects.
You could also try contacting the Society of London Producers who circulate a list that matches investors with producers.
A minimum investment is typically £2,500 in a play or £10,000-£20,000 in a West End musical. Plays cost between £200,000 and £500,000 to get off the ground, a big musical anything up to £5m.
Picking your investment is key. A 12-week West End smash hit with stars could double your money in a very short period, for example Equus, with Daniel Radcliffe.
Most producers give their investor 60% of the profit of the production. Make sure you work this out before investing, to avoid problems later.
If a production is a great success it might tour, even head to the States, perhaps get made into a movie. Then the big money will start to roll. Check the rights before you sign up, otherwise you might find you're only entitled to profits made in the UK as your new play heads off to money-spinning Broadway and then Hollywood.
Out of 10 productions four will make some profit, three will see the investor get some but not all of their money back, and three will probably lose everything.
Big shows by big name producers won't be looking for small investors because they don't need to. Approach small up coming producers who you think are about to strike it lucky!
- If you are serious about investing in the theatre, make sure you are fully aware of the industry and are able to keep abreast of new developments.
- Further information on theatrical investment may be obtained from the Society of London Theatre (The Society of London Theatre, 32 Rose Street, London WC2E 9ET)telephone: 020 7557 6700.
- Although there are tales of investors putting all their money into shows like Cats and doing very well out of it, the likelihood of success for this kind of investment is small. Never invest more than you are prepared to lose.
No comments:
Post a Comment